New options for the United States Oil Fund (USO) went live today, October 7th, featuring significant contracts for traders. A put option with a $144.00 strike price is currently at a bid of $3.00, allowing investors to effectively purchase shares at $141.00 after the premium, compared to the current trading price of $145.80. This put contract has a 57% probability of expiring worthless, providing a potential 2.08% return on cash commitment, or 50.69% annualized.
Additionally, a call option with a $147.00 strike price is being bid at $4.30. If an investor buys USO at $145.80 and sells the call, they could achieve a total return of 3.77% if the stock gets called away by expiration. There’s a 51% chance this call will expire worthless, yielding a 2.95% additional return, or 71.76% annualized, if the shares are retained.
Implied volatility for the put is 50%, while the call stands at 52%. The trailing twelve-month volatility for USO is calculated at 49% based on recent price movements.
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