Investors in Invesco QQQ Trust (QQQ) saw new options trading commence on August 4, 2023, highlighting significant put and call contracts. The $695 put option has a current bid of $9.87, allowing investors to commit to purchasing QQQ shares at a price of $695, which can result in a cost basis of approximately $685.13. This represents a 1% discount to QQQ’s current trading price of $703.23, with a 63% chance of expiration worthlessness, offering a potential 1.42% return on cash commitment.
On the call side, the $710 option boasts a bid of $11.74, enabling investors to sell the stock if it reaches that price at expiration. This would yield a total return of 2.63% based solely on premiums collected, with a 54% chance that the contract may expire worthless, thereby retaining both shares and premiums. Implied volatility is noted at 27% for puts and 25% for calls, while the actual trailing twelve-month volatility is calculated at 19%.
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