New Options Trading Highlights for Take-Two Interactive Software
Investors in Take-Two Interactive Software, Inc. (Symbol: TTWO) will notice new options trading as of today, specifically for contracts expiring on May 30th. The Stock Options Channel has utilized its YieldBoost formula to examine the TTWO options chain, identifying one noteworthy put contract and one call contract.
Put Contract Insights
The put contract at the $200.00 strike price currently has a bid of $10.00. By selling-to-open this contract, an investor agrees to purchase stock at $200.00 while also collecting the premium, effectively lowering the cost basis to $190.00 per share before broker commissions. For those looking to invest in TTWO, this approach offers a potential discount compared to the current trading price of $202.94 per share.
Notably, the $200.00 strike price represents approximately a 1% discount to TTWO’s prevailing market price, indicating it is out-of-the-money by that margin. Data suggests a 58% chance that the put contract may expire worthless. Stock Options Channel will monitor these odds over time and publish a chart reflecting any changes on its website under the contract detail page. If the contract does expire worthless, it could yield a 5.00% return on the cash commitment, or an annualized rate of 36.50%. This is referred to as the YieldBoost.
Visual Overview of Trading History
Below is a chart illustrating Take-Two Interactive Software’s trading history over the past twelve months, with the $200.00 strike highlighted:
Call Contract Analysis
On the call side, the $205.00 strike contract has a current bid of $11.80. By purchasing shares at the current price of $202.94 and selling-to-open this call contract as a “covered call,” an investor commits to sell at $205.00 per share. The premium collected would result in a total return of 6.83% if the stock is called away at expiration on May 30th, excluding any dividends and before broker commissions. However, significant upside could remain if TTWO shares experience a considerable increase, emphasizing the importance of analyzing the stock’s historical performance and business fundamentals.
Below is a chart showing TTWO’s trailing twelve-month trading history, with the $205.00 strike highlighted in red:
The $205.00 strike price reflects approximately a 1% premium over the current trading price, marking it as out-of-the-money by that percentage. Thus, the covered call contract could also expire worthless, allowing investors to retain both their shares and the premium collected. Current analytical data indicates a 48% probability of this occurrence. Stock Options Channel will continue to monitor the odds and provide updates on contract history via their website. Should this contract also expire worthless, it would represent an additional 5.81% return for the investor, or an annualized 42.45%, classified as another YieldBoost.
Volatility and Further Opportunities
The implied volatility for both the put and call contract examples is approximately 43%. In contrast, the actual trailing twelve-month volatility, based on the last 251 trading days along with today’s price of $202.94, is estimated at 28%. Investors seeking additional options contracts may explore further opportunities at StockOptionsChannel.com.
Top YieldBoost Calls of the Nasdaq 100 »
also see:
- NDLS Options Chain
- IHF Shares Outstanding History
- Institutional Holders of LII
The views and opinions expressed herein are solely those of the author and do not necessarily reflect those of Nasdaq, Inc.
