Coinbase Options: A Look at New Investment Opportunities
New options for Coinbase Global Inc (Symbol: COIN) are now available, focusing on December 13th contracts. Our analysis at Stock Options Channel has spotlighted key put and call contracts that may appeal to investors.
Exploring the $190 Put Contract
The put contract at the $190.00 strike price currently has a bid of $17.10. Investors selling this put will agree to buy shares at $190.00 while collecting the premium, effectively lowering the purchase cost to $172.90 (not including brokerage fees). For those looking to invest in COIN, this could be a more appealing route than buying at the current price of $194.88 per share.
This $190.00 strike price offers about a 2% discount from the stock’s current trading price, meaning it is slightly out-of-the-money. There is also a chance that this put contract could expire worthless, with current data indicating a 61% likelihood. If it does expire worthless, the premium collected would yield a 9% return on the cash commitment, translating to an annualized rate of 76.32%, a figure we refer to as the YieldBoost.
Below is a chart showcasing the last twelve months of trading history for Coinbase Global Inc, with the $190.00 strike marked in green:
Analyzing the $200 Call Contract
On the calls side, the $200.00 strike price call contract has a bid of $19.60. Investors purchasing COIN at the current price of $194.88 and selling this call as a “covered call” would commit to selling at $200.00. If called away at expiration, the total return (excluding dividends) would be 12.68%, calculated before brokerage fees. However, if COIN shares rise significantly, investors could miss out on potential profits, highlighting the importance of reviewing both trading history and fundamental business data.
Displayed below is a chart of COIN’s trading history over the past twelve months, with the $200.00 strike marked in red:
The $200.00 strike represents a 3% premium over the current trading price. This means there’s a chance the covered call contract could expire worthless, allowing investors to keep both their shares and the premium. Current data estimates a 47% probability of the contract expiring worthless. If it does, the premium earned would add an extra 10.06% return, or 85.29% annualized, another application of our YieldBoost.
The implied volatility for the put contract is currently at 79%, while the call contract shows a volatility of 80%. In contrast, we calculated the actual trailing twelve-month volatility to be 75%, using the previous 251 trading days and the current price of $194.88. For further insights into put and call options, visit StockOptionsChannel.com.
Top YieldBoost Calls of the S&P 500 »
Also see:
• ACIW YTD Return
• BFLY shares outstanding history
• CEFA shares outstanding history
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.