New Options Trading Opportunities for Dynavax Technologies Investors
Investors in Dynavax Technologies Corp (Symbol: DVAX) observed the initiation of new options trading this week with May 16th expiration dates. Stock Options Channel employed their YieldBoost formula to analyze the DVAX options chain, identifying one notable put and one call contract.
Details on the Put Contract
The put contract at the $13.00 strike price currently has a bid of 5 cents. An investor selling to open this put contract would commit to purchasing shares at $13.00. However, they would also collect the premium, which lowers the effective cost basis to $12.95 (before any broker commissions). For investors interested in acquiring DVAX shares, this option may present a cost-effective alternative compared to the current market price of $13.91 per share.
Notably, the $13.00 strike price is about a 7% discount off the current trading price (indicating it’s out-of-the-money). The analytical data suggests a 73% chance that this put contract will expire worthless. Stock Options Channel will continue to monitor and update these odds, publishing detailed charts on their website. If the put expires worthless, the collected premium would yield a return of 0.38% on the cash commitment, approximately 2.65% annualized—what we classify as a YieldBoost.
Chart of Trading History
Below is a chart illustrating the trailing twelve months of trading history for Dynavax Technologies Corp, highlighting the $13.00 strike price in green:
Insights on the Call Contract
On the call side, the contract at the $14.00 strike price is currently trading with a bid of 45 cents. An investor purchasing DVAX shares at $13.91 and selling this call contract as a “covered call” would limit their selling price to $14.00. If the stock gets called away by the May 16th expiration, the investor would see a total return (excluding any dividends) of 3.88%, not accounting for broker commissions. However, this strategy could limit potential gains if DVAX shares appreciate significantly. Assessing both the recent trading history and business fundamentals is important.
Below is a chart showing DVAX’s trailing twelve-month trading history, with the $14.00 strike highlighted in red:
The $14.00 strike price represents about a 1% premium over the current market trading price (indicating it is also out-of-the-money). The analytical data indicates a 45% chance that this covered call contract may expire worthless. If that occurs, the investor retains both their shares and the premium collected. If the call expires worthless, the premium provides a 3.24% boost to total returns, or 22.28% annualized—another example of the YieldBoost.
Volatility Analysis
In the put contract scenario, the implied volatility is 41%. Conversely, the call contract shows an implied volatility of 36%. The actual trailing twelve-month volatility, based on the last 249 trading days along with today’s price of $13.91, is calculated at 31%. For further insights on available put and call options contracts, consider visiting StockOptionsChannel.com.
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also see:
- CURO Historical Stock Prices
- SOXX Split History
- EQC Shares Outstanding History
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
