Investors in the iShares 20+ Year Treasury Bond ETF (TLT) gained access to new options today, set to expire on June 3rd. A notable put contract at the $76.00 strike price has a current bid of $0.04, offering an 8% discount off TLT’s trading price of $83.01. Selling this contract would result in an effective purchase price of $75.96, with a 97% likelihood of the put expiring worthless.
On the call side, a contract at the $84.00 strike price offers a bid of $0.39, providing a potential total return of 1.66% if TLT shares are called away at expiration. This strike price is approximately 1% above the current trading price, with a 68% chance that it may also expire worthless. The current implied volatility for the put contract is 24%, while it is at 12% for the call contract.
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