Investors in 3M Co (Ticker: MMM) saw new options trading commence today, October 12, 2023, with expiration set for November 20. Notable contracts include a put option with a $180 strike price currently trading at a bid of $6.90. If sold, this option would allow investors to purchase the stock at an effective cost basis of $173.10, presenting a potential savings compared to the current market price of $183.96 per share.
On the call side, a $185 strike price contract is currently bid at $8.75. Selling this as a covered call could yield a 5.32% return if shares are called away by the expiration date. Current data indicates a 60% chance the put option may expire worthless, and a 48% chance for the call option under the same condition. The implied volatility for the put is 29%, and 27% for the call, while the actual trailing twelve-month volatility stands at 27%.
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