Ark Genomic Revolution Etf (Symbol: ARKG) has electrified investors as new options emerged for this week, with the October 18th expiration date looming. This development presents an alluring possibility owing to the 245 days until expiration. At Stock Options Channel, our keen observance of the ARKG options chain for the fresh October 18th contracts has pinpointed a put and a call contract of remarkable interest.

Potential Opportunities in Put Contracts

Take, for instance, the put contract at the $31.00 strike price, currently valued at $3.80. An investor willingly selling-to-open that put contract commits to purchasing the stock at $31.00, thus collecting the premium, essentially positioning the cost basis of the shares at $27.20 before broker commissions. Such an opportunity, while requiring due contemplation, seemingly outshines the current market price of $31.57/share.

The $31.00 strike marks an approximate 2% discount to the current trading price, possibly leading to the expiry of the put contract at nil value. The present analytical data indicates a 63% probability of this event. Stock Options Channel stands poised to monitor these probabilities over time via a dedicated chart on our website, encapsulating the contract detail. Should expiration prove futile, the premium translates to a 12.26% return on the cash commitment or an annualized 18.27%, warmly referred to as the YieldBoost.

Visualizing the Put Contract

The chart succinctly illustrates the trailing twelve-month trading history for Ark Genomic Revolution Etf, shadowing the $31.00 strike in relation to its trajectory.

Opportunities to Explore in Call Contracts

Meanwhile, on the calls side, the $33.00 strike call contract is commanding a bid of $3.90. In the event an investor opts to purchase ARKG shares at the current price of $31.57/share and subsequently sells-to-open the call contract as a “covered call,” the commitment to sell the stock at $33.00 unfolds. This maneuver, inclusive of the premium, could potentially yield a total return of 16.88% if the stock is called away at the October 18th expiration.

Considering an approximate 5% premium, the $33.00 strike endorses the possibility of the covered call contract expiring worthless, looming at a 43% likelihood as per current analytical data. Stock Options Channel pledges to scrutinize these odds over time, availing a chart displaying the numbers on our website. Should the contract expire in vain, the premium would furnish a 12.35% boost of extra return, equivalent to an 18.41% annualization, colloquially known as the YieldBoost.

Visualizing the Call Contract

The chart captures ARKG’s trailing twelve-month trading history, accentuating the $33.00 strike in a bold red hue.

Implications and Analysis

The implied volatility manifests as 51% in the put contract, while the call contract example illustrates a 41% implied volatility. Calculating the actual trailing twelve-month volatility as 41%, vis-à-vis the last 251 trading day closing values and the current price of $31.57, uncovers vital insights. For additional put and call options contract ideas, we invite you to visit StockOptionsChannel.com.

Top YieldBoost Calls of the S&P 500

Also see:

• RLJ Insider Buying
• DEN YTD Return
• Funds Holding FVAL

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.