Exploring New Opportunities for Investors
Investors can now trade options for Viper Energy Inc (Symbol: VNOM) expiring in November 2025. With 410 days until expiration, these contracts offer a chance for sellers to earn higher premiums due to the time value involved.
Put Contracts Offer Attractive Alternatives
One put contract at the $50.00 strike price is currently bidding at $4.00. By selling this contract, an investor commits to buying the stock at $50.00 but also receives the premium, effectively lowering the cost basis to $46.00 per share. This presents an appealing alternative for those eyeing VNOM shares at $51.28 today.
Meanwhile, the call contract at the $55.00 strike price is bidding at $2.80. Selling this contract as a covered call, investors commit to selling the stock at $55.00. This strategy could result in a total return of 12.71% if the stock reaches that price by November 2025.
Understanding Risk and Return
Analyzing historical trading data and business fundamentals is crucial for making informed decisions. The performance of the $50.00 and $55.00 strike prices in relation to VNOM’s trading history provides insights into potential outcomes.
While these options offer additional returns, investors should assess the risks involved. The current analytical data indicate the probability of contracts expiring worthless, which also influences the premiums received.
Volatility Insights
The implied volatility for the put and call contracts is 35% and 32% respectively. Comparatively, the actual trailing twelve-month volatility stands at 29%, factoring in recent closing values and the current stock price of $51.28.
For more option contract ideas and analysis, investors can visit StockOptionsChannel.com. Remember, wise investing combines strategy, risk assessment, and market insights for optimal results.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.