Exploring Put Options on April 12th
As investors in Ford Motor Co. (Symbol: F) embrace a fresh day in the stock market den, curious eyes are turning towards the newly unveiled options for the April 12th expiration. The scent of intrigue wafts as our YieldBoost formula sniffs along the F options chain, unearthing a solitary put and call contract that beckons attention.
The put contract beckoning from the $12.00 strike price is adorned with a modest current bid of 24 cents. The brave soul willing to sell-to-open this put contract is pledging to acquire the stock at $12.00, earning the charm of a premium that shaves the cost basis of the shares to $11.76 (pre-broker commissions). For those potent investors eying F shares, this might present a compelling path to possession, a divergence from today’s song of $12.41/share.
This $12.00 strike, positioned approximately 3% beneath the stock’s prevailing trading price, dances on the outskirts of profitability. With odds, as data whispers, hinting at a 99% chance of the contract wilting away fruitless. Stock Options Channel will monitor these odds, painting a graph of their transformation on our digital canvas. Should this contract wither into void, the premium will spring forth as a 2.00% return on the cash pledged, or an annual dance of 16.99% — what we at Stock Options Channel choose to term the YieldBoost.
Peering through the telescope, behold a historical parade of Ford Motor Co.’s yesteryears in trading. The $12.00 strike stands adorned in green, a chapter in the grand tale of its trading history.
Delving into Call Options on April 12th
Shifting gears towards the calls aisle of the option chain, the call contract nested at the $12.50 strike price lures with a bid of 46 cents. A journeyman traversing this path would acquire F shares at the present $12.41/share and then sell-to-open this call contract in a “covered call” embrace, vowing to peddle the stock at $12.50. As the call sage reaps the premium, a voyage beckons promising a total return (sans dividends) of 4.43% should the stock be summoned away come the April 12th sunset (pre-broker commissions).
A surplus of dreams might flit away if F shares launch into the stratosphere, hence the need to peruse Ford Motor Co.’s historical trading manuscript. A map unfolds depicting Ford’s doings in the past year, with the $12.50 strike shimmering in red.
Yet, this $12.50 strike perches approximating a 1% premium over the current trading price, a breath away from in-the-money land. Thus, there exists a chance that the veiled call contract might gasp its last, granting the investor both their share legacy and the orphaned premium. Analytical mystics whisper a 99% likelihood of this quietus. Stock Options Channel will watch these odds waltz, etching a portrait of their metamorphosis, side by side with the option contract’s trading chronicle. If this covered call vessel drifts into night, the premium will embroider a 3.71% adornment of extra return, or a yearly symphony of 31.49%, better known as the YieldBoost.
Deciphering the Twists and Turns
The shadows whisper tales of the actual trailing twelve-month volatility, fingered by the final 251 closing prices of yore and today’s sweet $12.41 bookmark. For a treasury of put and call options luring the curious eye, StockOptionsChannel.com stands ready for perusal.