Investors Consider Selling Puts for Extreme Networks Shares

Investors interested in buying Extreme Networks Inc (Symbol: EXTR) shares, currently priced at $13.40 each, may want to explore alternative strategies like selling puts. A noteworthy option is the January 2026 put contract with a $10 strike price, which has a bid of 80 cents at the time of writing. Selling this put could yield an 8% return on the $10 commitment, translating to a 10.1% annualized rate of return, a value we refer to as the YieldBoost at Stock Options Channel.

While selling a put does not allow investors to capitalize on share price increases as owning the stock does, it offers a different investment route. The seller will only acquire shares if the contract is exercised. This typically happens when exercising the put produces a better financial outcome than selling at the current market rate. Unless Extreme Networks Inc’s shares decrease by 25.1%, making the exercise of the contract advantageous, the put seller’s only benefit comes from the premium collected, yielding a 10.1% annualized return after accounting for the 80 cents received from the $10 strike.

Below is a chart depicting the trailing twelve-month trading history for Extreme Networks Inc, highlighting the $10 strike position in green:

The aforementioned chart, when evaluated alongside Extreme Networks Inc’s historical volatility, serves as a valuable tool. It aids in assessing whether selling the January 2026 put at the $10 strike for a 10.1% annualized return justifies the associated risks. Recent calculations show a trailing twelve-month volatility of 39% based on the last 251 trading days and today’s price of $13.40. For additional put options ideas at various expiration dates, take a look at the EXTR Stock Options page on StockOptionsChannel.com.

During mid-afternoon trading on Wednesday, the put volume among S&P 500 components reached 837,454 contracts, matching the call volume. This resulted in a put-to-call ratio of 0.75 for the day, higher than the long-term median of 0.65. This suggests that the current market shows more put buying activity than what historical trends would indicate.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.