IREN Ltd (Symbol: IREN) announced new options available for expiration on August 22nd. Investors can sell-to-open a put contract at a $14.00 strike price with a current bid of $0.77, effectively committing to buy shares at $14.00, resulting in a cost basis of $13.23. This represents a 20% discount to the current trading price of $17.41 per share.
The odds of the put contract expiring worthless are estimated at 75%. If this occurs, it would yield a 5.50% return on the cash commitment, or a 40.15% annualized return. Additionally, a call contract at a $20.00 strike price offers a current bid of $1.50, which could provide a 23.49% return if IREN shares are called away at expiration.
The current odds of the call contract expiring worthless stand at 57%, with potential returns from premiums potentially leading to an 8.62% extra return, or a 62.89% annualized return. The implied volatility for the put contract is 139%, while the call contract has an implied volatility of 124%.
