Investors in Brookfield Asset Management Ltd (Ticker: BAM) have new options available as of today, expiring on June 18th, 2023. Notably, a put contract at the $40.00 strike price offers a current bid of 40 cents, potentially allowing investors to purchase shares at a cost basis of $39.60, which is a 7% discount from the current trading price of $43.14. There’s a 68% chance this put option may expire worthless.
On the calls side, a contract at the $45.00 strike has a current bid of 75 cents. If investors buy shares at $43.14 and sell this call contract, they could yield a total return of 6.05% if exercised. It’s noted that there is a 55% chance this call may also expire worthless, allowing the investor to keep both shares and premium collected, representing an annualized return of 7.65%. The implied volatility for the put is 44% and for the call is 41%, while the trailing twelve-month volatility stands at 32%.
