Investors in Chubb Ltd (Symbol: CB) saw new options trading begin on September 15, 2023, with contracts expiring in September 2027. The put contract with a strike price of $340.00 has a current bid of $23.00, offering potential buyers a discount to today’s price of $347.84/share. If exercised, the effective cost for shares could be $317.00 after premium collection, providing an approximate 2% discount.
The call contract at the $370.00 strike has a current bid of $26.90, allowing investors to potentially secure a total return of 14.10% if the stock is called away at expiration. Both contracts present opportunities for yield enhancement, with the put offering a potential 6.76% return on cash commitment and the covered call potentially yielding a 7.73% extra return, based on current assumptions.
The implied volatility for the put is 23% and for the call is 24%, while the trailing twelve-month volatility stands at 19%. Current data suggests a 63% chance that the put could expire worthless, and a 51% chance for the call contract.
5 Stocks Our Experts Predict Could Double In the Next Year
By submitting your email, you'll also get a free pivot & flow membership. A free daily market overview. You can unsubscribe at any time.
