New Options Trading for Alphabet Inc Offers Investment Opportunities

Investors in Alphabet Inc (Symbol: GOOG) can now access new options that commenced trading today, with a June 2027 expiration date. One crucial factor influencing how much an option buyer is willing to pay is time value. With 807 days remaining until expiration, these newly trading contracts present potential opportunities for sellers of both puts and calls to collect a higher premium than what is typically available for contracts with nearer expiration dates. Utilizing our YieldBoost formula, Stock Options Channel has analyzed the GOOG options chain and pinpointed one put and one call contract of special interest.

Detailed Analysis of Put Contract

The put contract at the $155.00 strike price currently has a bid of $23.00. If an investor chooses to sell-to-open this put contract, they agree to buy the stock at $155.00 while also collecting the premium. This arrangement effectively lowers the cost basis of shares to $132.00 (before broker commissions). For investors looking to purchase shares of GOOG, this option represents an appealing alternative to the current market price of $157.16 per share.

The $155.00 strike price reflects approximately a 1% discount from the current trading price, indicating that it is out-of-the-money. Current analytical predictions, including greeks and implied greeks, estimate a 67% chance that this put contract may expire worthless. Stock Options Channel will monitor these odds over time and provide updates on a dedicated chart available on our website. Should the contract expire worthless, the premium collected would yield a 14.84% return on the cash commitment, equating to an annualized rate of 6.71%, which we refer to as the YieldBoost.

Review of Trading History

Below is a chart displaying the trailing twelve-month trading history for Alphabet Inc, with the $155.00 strike highlighted in green:

Exploring the Call Contract

On the calls side, the call contract at the $185.00 strike price currently bids at $24.50. Investors purchasing GOOG shares at the current price of $157.16 per share could opt to sell-to-open this call contract as a covered call. This commitment allows for selling the stock at $185.00. With the premium included, the total return would reach 33.30% if the stock is called away at the June 2027 expiration, excluding dividends and broker commissions.

However, if GOOG shares experience significant growth, some potential gains could be forfeited. Therefore, analyzing the trailing twelve-month trading history and studying the company’s fundamentals are essential. Below is a chart depicting GOOG’s trailing twelve-month trading history with the $185.00 strike marked in red:

The $185.00 strike price signifies an approximate 18% premium over the current trading price, indicating that it is also out-of-the-money by this margin. This presents a possibility that the covered call contract may expire worthless, allowing the investor to retain both their shares and the collected premium. Current analytical data, including greeks and implied greeks, estimate a 46% probability of this occurring. Stock Options Channel will also monitor these odds over time, publishing historical charts for the option contract on our website. Should the covered call expire worthless, the premium would represent a 15.59% additional return for the investor, or 7.05% annualized, again classified as a YieldBoost.

In the context of implied volatility, the put option has a volatility of 36%, while the call option reflects a volatility of 35%. Meanwhile, the actual trailing twelve-month volatility, calculated using the last 251 trading day closing values alongside today’s price of $157.16, is 29%. For further put and call options contract ideas, visit StockOptionsChannel.com.

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• Institutional Holders of FLDM
• RSPD Options Chain

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