Skyworks Solutions Inc: New Options Available for December 20th Expiration
Investors in Skyworks Solutions Inc (Symbol: SWKS) are now seeing new options available for trading, set to expire on December 20th. The options chain has revealed interesting opportunities for both put and call contracts that may appeal to traders.
Analysis of the $90 Put Option
The put contract at the $90.00 strike price is currently bid at $2.60. By selling to open this put, an investor agrees to buy the stock at $90.00 while collecting the premium. This brings the effective cost of the shares down to $87.40 (excluding broker commissions). For anyone interested in buying SWKS shares now priced at $98.80, this could be a more attractive option.
Investors should note that the $90.00 strike price is around a 9% discount from the current trading price. Thus, the put could also expire worthless. Current analysis suggests there is a 74% chance of this occurring. Stock Options Channel will continue to track these odds over time, sharing updated charts on our website. If the put expires worthless, the premium earned would yield a return of 2.89%, translating to an annualized rate of 16.46%, which we term as YieldBoost.
Charting Trading History
Below is a chart showing the past twelve months of trading activity for Skyworks Solutions Inc, with the $90.00 strike price clearly marked:
Insights on the $100 Call Option
On the call option side, the contract at the $100.00 strike price currently has a bid of $5.60. If an investor buys SWKS shares at the current price of $98.80/share and then sells to open this call as a covered call, they agree to sell the stocks at $100.00. Including the premium, this could yield a total return of 6.88% if the stock is called away at expiration (excluding dividends and broker commissions). However, if SWKS shares increase significantly, some potential gains might be lost, making it crucial to analyze both historical trading patterns and the company’s fundamentals.
The following chart illustrates the recent trading history of SWKS, highlighting the $100.00 strike:
Considering Potential Outcomes
The $100.00 strike price is only about a 1% premium over the current trading value of the stock. This means there’s a chance the covered call could expire worthless, in which case the investor retains both their shares and the premium. Current data indicate a 49% probability of this happening. Stock Options Channel will also be monitoring and updating these metrics on their website. Should the covered call expire worthless, the premium collected would lead to an additional 5.67% return, representing an impressive annualized yield of 32.30%, again referred to as YieldBoost.
Volatility Overview
The implied volatility for the put contract is presently 41%, while the call contract sits at 38%. In comparison, the actual twelve-month volatility, based on the last 251 trading days and the current stock price of $98.80, is calculated at 36%. For further put and call options worth exploring, Stock Options Channel offers a variety of resources.
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Also see:
- Materials Dividend Stock List
- DLO Stock Predictions
- TRB Historical Stock Prices
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
