Investors in United Parcel Service Inc (UPS) can now access new options expiring on August 21, with 109 days until expiration. A notable put contract at the $95.00 strike price has a current bid of $4.10, allowing investors to potentially purchase shares at an effective cost basis of $90.90, representing a 3% discount from the current trading price of $98.17. The odds of this option expiring worthless are estimated at 61%.
On the call side, a contract at the $100.00 strike price has a bid of $5.25. If an investor buys UPS shares at $98.17 and sells this call, they could achieve a total return of 7.21% if the shares are called away by expiration. This call option has a 52% chance of expiring worthless, allowing the investor to keep both the shares and the premium, equating to a potential 5.35% yield boost.
Current implied volatilities for the put and call contracts are 32% and 33%, respectively, while the trailing twelve-month volatility for UPS is calculated at 30%.
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