Exploring Investment Opportunities
Apple Inc (AAPL) has introduced new options for investors today, available until May 24th. Stock Options Channel has meticulously examined the AAPL options chain, pinpointing one put and one call contract worth considering.
Put Contracts Analysis
The put contract at the $150.00 strike price currently has a bid of 35 cents. By selling-to-open this put contract, investors commit to purchasing the stock at $150.00 while pocketing the premium, thus setting the cost basis of the shares at $149.65 (excluding broker commissions).
Strategic Considerations
Given that the $150.00 strike represents around a 12% discount to the current trading price of the stock, there is a chance the put contract could expire worthless. Analytical data indicates an 87% probability of this outcome, with Stock Options Channel monitoring these odds over time.
Appealing Alternatives
The call contract at the $175.00 strike price boasts a bid of $2.78. Investors can buy AAPL shares at the current price of $171.03/share and then sell-to-open the call contract, committing to sell the stock at $175.00. This strategy could yield a total return of 3.95% if the stock is called away at the May 24th expiration.
Risk Considerations
With the $175.00 strike representing approximately a 2% premium to the current trading price, there is a possibility that the covered call contract could expire worthless, leaving the investor with both their shares and the premium collected.
Market Volatility and Tips
The implied volatility in the put contract stands at 33%, while the call contract shows 24% implied volatility. Actual trailing twelve-month volatility is calculated at 19%. For more insights into put and call options contract ideas, investors can explore StockOptionsChannel.com.
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The viewpoints expressed here are the author’s and do not necessarily align with those of Nasdaq, Inc.
