Microsoft Corporation (MSFT) offers shareholders the opportunity to enhance their income by selling a December 2027 covered call at the $700 strike price, with a premium bid of $26.90. This could yield an additional 2.2% annual return, bringing the total annualized return to 2.9% if the stock does not reach the strike price. For the stock to be called away at $700, it would need to increase by 39.3%, resulting in a total return of 44.7% for shareholders if the stock is called, including dividends.
As of Wednesday afternoon trading, the put volume among S&P 500 components was 556,880 contracts, while call volume reached 1.21 million, reflecting a put-to-call ratio of 0.46. This indicates a significantly higher volume of call options compared to puts, suggesting investor preference for call options.
