Investors in DigitalOcean Holdings Inc (DOCN) gained access to new options contracts with a June 2027 expiration today. Among the noteworthy options is a put contract for a $150.00 strike price, currently bidding at $44.00. Selling this contract commits the investor to purchase shares at $150.00, effectively lowering the cost basis to $106.00, which is about 31% below the current share price of $153.99. The estimated probability of this put contract expiring worthless is 70%.
On the call side, a $170.00 strike call contract is bidding at $47.00. If an investor buys shares at $153.99 and sells this covered call, the total return could reach 40.92% if the stock is called at expiration. However, there’s a 35% chance that the call could expire worthless, in which case the investor retains both their shares and the premium. Current implied volatilities for the put and call contracts are 87% and 86%, respectively, while the actual trailing twelve-month volatility stands at 77%.
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