Nov 19 options now available for Xilinx
IInvestors in Xilinx, Inc. (ticker: XLNX) saw new options become available today, with the November 19 expiration. One of the key things that goes into the price that an option buyer is willing to pay is time value. So, with 105 days to expiration, the new contracts available represent a potential opportunity for put or buy sellers to earn a higher premium than they would. be available for short-term contracts. TO Stock option channel, our YieldBoost formula walked through the XLNX options chain for new November 19 contracts and identified a sell contract and a buy contract of particular interest.
The contract to sell at the strike price of $ 150.00 has a current bid of $ 14.35. If an investor were to sell to open this sales contract, they agree to buy the share at $ 150.00, but will also receive the premium, bringing the base price of the shares to $ 135.65 (before commissions broker). For an investor already interested in purchasing XLNX shares, this could represent an attractive alternative to paying $ 151.19 / share today.
Since the strike price of $ 150.00 represents a discount of around 1% from the current share price (in other words, it is out of the money by that percentage), it is also possible that the sales contract expires worthless. Current analytical data (including Greeks and Greeks implied) suggests that the current chance of this happening is 100%. Stock Options Channel will monitor these quotes over time to see how they evolve, posting a chart of these numbers on our website under contract detail page for this contract. If the contract expires worthless, the premium would represent a 9.57% return on the cash commitment, or 33.24% annualized – at Stock Options Channel we call that the YieldBoost.
Below is a chart showing Xilinx, Inc.’s past twelve month trading history, and highlighting in green the location of the $ 150.00 exercise against that history:
Regarding the option chain calls, the contract to buy at the strike price of $ 155.00 has a current bid of $ 13.75. If an investor were to buy XLNX shares at the current price level of $ 151.19 / share, then sell to open that purchase contract as a “covered call”, they agree to sell the share at 155, $ 00. Since the call seller will also receive the premium, this would generate a total return (excluding dividends, if any) of 11.61% if the stock was recalled at the expiration of November 19 (before broker commissions. ). Of course, a lot of benefits could be left on the table if XLNX stocks really soar, which is why it becomes important to look at the past twelve month trading history of Xilinx, Inc., as well as ” study the fundamentals of the business. Below is a chart showing the 12-month trading history of XLNX, with the strike price of $ 155.00 highlighted in red:
Since the strike price of $ 155.00 represents a premium of around 3% over the current share price (in other words, it is out of the money by that percentage), it is It is also possible that the covered purchase contract will expire worthless, in which case the investor would keep both his shares and the premium received. Current analytical data (including Greeks and Greeks implied) suggests that the current chance of this happening is 99%. On our website under contract detail page for this contract, Stock Options Channel will track these quotes over time to see how they change and publish a chart of these numbers (the option contract’s trading history will also be plotted). If the covered purchase contract expires worthless, the premium would represent a 9.09% increase in the additional return to the investor, or 31.60% annualized, which we call the YieldBoost.
Meanwhile, we calculate the actual volatility of the past twelve months (taking into account the closing values of the last 252 trading days as well as today’s price of $ 151.19) at 42%. For more put and call option contract ideas worth considering, visit StockOptionsChannel.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.