Investors in Microsoft Corporation (MSFT) are exploring new options set to expire on April 24, 2024. Notably, the put contract with a $405.00 strike price has a bid of $12.35, implying a cost basis of $392.65 if executed at the current stock price of $407.17, marking a potential 1% discount. The likelihood of the put contract expiring worthlessly is estimated at 59%.
On the call side, the $415.00 strike price call has a bid of $14.70. If MSFT shares are purchased at $407.17 and a covered call is opened at this strike price, the expected total return could be 5.53% by April 24, excluding dividends. This call option carries a 50% chance of expiring worthless, potentially providing a 3.61% return boost to investors, equating to 26.38% annualized.
Current implied volatilities for the put and call contracts are 29% and 30%, respectively, while the trailing twelve-month volatility for MSFT is calculated at 26%.
