Investors in Knight-Swift Transportation Holdings Inc (KNX) can now access new options expiring in December 2028. The put contract at a $70.00 strike price has a current bid of $12.40, allowing investors to effectively lower their purchase price to $57.60 if they sell-to-open. This represents a more attractive entry point compared to the current share price of $77.95, reflecting an approximate 10% discount. The odds of the put contract expiring worthless stand at 73%, potentially offering a 17.71% return on cash commitment, or 6.99% annualized.
Additionally, a call contract at an $85.00 strike price has a bid of $18.00. If investors purchase shares at $77.95 and sell this call as a covered call, they could realize a total return of 32.14% if the stock is called away by the expiration date. The likelihood of this call contract expiring worthless is 39%, which could still yield a 23.09% additional return for the investor, or 9.11% annualized. The current implied volatility for the put is 46%, while the call’s implied volatility is 44%.
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