Exploring Put Options
As investors fervently tracked Tesla Inc’s (TSLA) market activity this week, a new wave of options marked their entrance for the May 3rd expiration date. Amid this tumultuous sea of financial strategy, a compelling narrative unfolded through the lens of our YieldBoost formula. This algorithm meticulously scrutinized the TSLA options chain, spotlighting one put and one call contract that stood out amidst the frenzy.
At the $160.00 strike price, a put contract beckoned with a current bid of $7.45. Should an investor opt to sell-to-open this put contract, they would be obligating themselves to fetch the stock at $160.00. However, in a fortuitous twist, they would also pocket the premium, whittling down the cost basis of the shares to $152.55 (exclusive of broker commissions). This tantalizing offer, about a 6% markdown from the prevailing stock price, paints an enticing portrait for potential TSLA shareholders.
Grasping the Odds and Charting the History
There looms the specter of the put contract expiring as useless as a sun hat in a snowstorm, an outcome with a 66% likelihood based on current analytical data. Stock Options Channel remains vigilant, monitoring the ebb and flow of these odds over time. Akin to a painter with a palette of numbers, a chart documenting these probabilities will soon grace our website, providing a visual feast for the data-hungry eyes.
Displaying the chart below, depicting Tesla Inc’s trailing twelve-month trading saga, with the $160.00 strike singled out in viridescent hues:
Shifting the narrative to the calls side of the option chain, the $175.00 strike call contract beckons with a bid of $9.75. If an investor were to embrace this contract after procuring TSLA shares at the current market value of $169.96 per share, they would engage in a covered call strategy. By selling-to-open this call option, they pledge to vend the stock at $175.00. Factor in the premium, and the resultant return (sans dividends) could amount to 8.70% at the May 3rd expiration (prior to broker commissions). Yet, a compelling caution lingers – a soaring TSLA could leave considerable potential gains on the table.
Delving Deeper with Analytics and Visualization
The $175.00 strike carries a premium of approximately 3% above the present stock price, hinting at a feasible yet uncertain path for the covered call contract. Its odds of fading into oblivion are pinned at 53% by the latest quantitative metrics. Stock Options Channel’s resolute gaze will persist, documenting the arc of these probabilities over time. Together with a historical chronicle etched in red below, outlining TSLA’s trading odyssey, with the $175.00 strike cast in vivid contrast:
Seeking the Perfect Balance
In a realm where implied volatilities reign supreme, the put option boasts a 56% volatility, while its call counterpart flaunts a 54% volatility. Moreover, the tangible volatility calculated over the last twelve months, factoring in today’s price of $169.96, stands at a serene 48%. For a treasure trove of further options insights, curious minds are encouraged to set sail and explore StockOptionsChannel.com.