F5 Inc (FFIV) Options Trading Insights: Opportunities for Investors

New options contracts for F5 Inc (Symbol: FFIV) are now trading, set to expire in July 2025. With 218 days remaining until expiration, this offers a strategic chance for put and call sellers to earn higher premiums than those available from shorter-term contracts.

Exploring Put Options: Potential Gains on the $260 Strike

The put contract at the $260.00 strike price currently has a bid of $15.10. Investors who sell this contract would be agreeing to buy shares at $260.00 while collecting the premium, effectively lowering the cost basis to $244.90 (before brokerage fees). Given the current share price of $261.81, this could serve as an attractive alternative for potential buyers of FFIV.

Notably, the $260.00 strike represents roughly a 1% discount off the current stock price, indicating that this contract could expire worthless. Current data suggests a 60% chance of this happening. Stock Options Channel will monitor and update these odds on their website. If the contract expires worthless, the investor could see a 5.81% return on the cash committed, or 9.73% annualized, a figure we refer to as YieldBoost.

Here’s a chart depicting F5 Inc’s trading history over the last twelve months, highlighting the $260.00 strike price:

Understanding Call Options: The $270 Strike Offer

On the call side, the contract priced at $270.00 is currently bid at $18.30. If an investor buys shares at $261.81 and simultaneously sells this call as a covered call, they commit to sell the stock at $270.00. This could yield a total return of about 10.12% (excluding any dividends) if the stock is called away at the July 2025 expiration.

However, the risk remains that a significant price increase for FFIV shares could result in lost potential gains. Therefore, it is vital for investors to analyze both the trading history and business fundamentals. Below is a chart showcasing FFIV’s trading history with the $270.00 strike price indicated in red:

This $270.00 strike indicates a 3% premium to the current share price, implying that the covered call could also expire worthless. Current analytics suggest a 47% likelihood of this outcome. In such a case, the investor retains their shares and the collected premium, resulting in an additional 6.99% return or 11.71% annualized, also classified as YieldBoost.

Volatility Insights

Both the put and the call contracts exhibit implied volatility of approximately 26%. In contrast, we calculate the actual trailing twelve-month volatility at 25%, based on the last 251 trading days. For additional put and call options ideas, consider visiting StockOptionsChannel.com.

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Also see:

• Cheap Dividend Stocks
• MBIO Average Annual Return
• NYRT Insider Buying

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