Investors in the Invesco QQQ Trust (Ticker: QQQ) gained access to new options with a December 2028 expiration on the date of this announcement. Notably, a put contract at a $565.00 strike price is currently bid at $69.50, which would require an investor to buy the stock at that price while effectively lowering the cost basis to $495.50. This offers a potential 12.30% return on the cash commitment if the contract expires worthless, with a current 67% chance of this happening.
Additionally, a call contract at a $650.00 strike price has a bid of $76.00. If an investor sells a “covered call” after purchasing shares at the current market price of $567.88, they could expect a total return of 27.84% if the shares are called away by the expiration date. This contract carries a 48% probability of expiring worthless, potentially yielding a 13.38% additional return, or 4.91% annualized.
Implied volatilities for the put and call contracts are 27% and 25%, respectively, while actual trailing volatility stands at 22%.
