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New options for APA Corp (Symbol: APA) began trading on October 2, 2023, with expiration set for December 2026. The new contracts, featuring 382 days until expiration, offer potential for higher premiums due to their time value.
A put contract with a $17.50 strike price has a current bid of $1.37, allowing investors to effectively lower their cost basis to $16.13 if they buy at that strike. This put represents a 32% discount to the current trading price of $25.74, with an 81% chance of expiring worthless, suggesting a 7.83% return on cash commitment. On the call side, a $35.00 call contract is currently bid at $1.52, representing a 36% premium to the current stock price, with a 63% chance of expiring worthless and offering a potential 5.91% boost in returns.
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