Investors in the iShares Trust – iShares MBS ETF (MBB) can now access new options contracts with a September 2027 expiration. Notably, a put contract at the $89.00 strike price has a current bid of $1.50, allowing investors to lock in a cost basis of $87.50 per share if exercised, representing a potential 1% discount on the current trading price of $89.87. Analytical data indicates a 57% chance that this put contract may expire worthless, yielding a 1.69% return based on cash commitment.
On the call options side, a contract at the $91.00 strike price has a bid of $1.75. Selling this as a “covered call” after purchasing shares at $89.87 would commit the investor to sell at $91.00, providing a total return of 3.20% if exercised. This call option carries a 58% chance of expiring worthless, potentially adding a 1.95% YieldBoost to the investment. Implied volatilities for the put and call contracts stand at 6% and 8%, respectively.
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