Traders in F5 Inc (Image: FFIV) noticed new choices start buying and selling this week, for the July 2025 expiration. One of many key inputs that goes into the worth an choice purchaser is keen to pay, is the time worth, so with 218 days till expiration the newly buying and selling contracts signify a possible alternative for sellers of places or calls to attain the next premium than could be obtainable for the contracts with a more in-depth expiration. At Stock Options Channel, our YieldBoost method has regarded up and down the FFIV choices chain for the brand new July 2025 contracts and recognized one put and one name contract of explicit curiosity.
The put contract on the $260.00 strike value has a present bid of $15.10. If an investor was to sell-to-open that put contract, they’re committing to buy the inventory at $260.00, however may even gather the premium, placing the associated fee foundation of the shares at $244.90 (earlier than dealer commissions). To an investor already serious about buying shares of FFIV, that might signify a pretty various to paying $261.81/share at present.
As a result of the $260.00 strike represents an approximate 1% low cost to the present buying and selling value of the inventory (in different phrases it’s out-of-the-money by that share), there’s additionally the likelihood that the put contract would expire nugatory. The present analytical information (together with greeks and implied greeks) counsel the present odds of that taking place are 60%. Inventory Choices Channel will observe these odds over time to see how they modify, publishing a chart of these numbers on our web site beneath the contract detail page for this contract. Ought to the contract expire nugatory, the premium would signify a 5.81% return on the money dedication, or 9.73% annualized — at Inventory Choices Channel we name this the YieldBoost.
Beneath is a chart exhibiting the trailing twelve month buying and selling historical past for F5 Inc, and highlighting in inexperienced the place the $260.00 strike is situated relative to that historical past:
Turning to the calls facet of the choice chain, the decision contract on the $270.00 strike value has a present bid of $18.30. If an investor was to buy shares of FFIV inventory on the present value stage of $261.81/share, after which sell-to-open that decision contract as a “lined name,” they’re committing to promote the inventory at $270.00. Contemplating the decision vendor may even gather the premium, that will drive a complete return (excluding dividends, if any) of 10.12% if the inventory will get known as away on the July 2025 expiration (earlier than dealer commissions). After all, numerous upside may doubtlessly be left on the desk if FFIV shares actually soar, which is why trying on the trailing twelve month buying and selling historical past for F5 Inc, in addition to finding out the enterprise fundamentals turns into necessary. Beneath is a chart exhibiting FFIV’s trailing twelve month buying and selling historical past, with the $270.00 strike highlighted in crimson:
Contemplating the truth that the $270.00 strike represents an approximate 3% premium to the present buying and selling value of the inventory (in different phrases it’s out-of-the-money by that share), there’s additionally the likelihood that the lined name contract would expire nugatory, during which case the investor would maintain each their shares of inventory and the premium collected. The present analytical information (together with greeks and implied greeks) counsel the present odds of that taking place are 47%. On our web site beneath the contract detail page for this contract, Inventory Choices Channel will observe these odds over time to see how they modify and publish a chart of these numbers (the buying and selling historical past of the choice contract may even be charted). Ought to the lined name contract expire nugatory, the premium would signify a 6.99% increase of additional return to the investor, or 11.71% annualized, which we discuss with because the YieldBoost.
The implied volatility within the put contract instance, in addition to the decision contract instance, are each roughly 26%.
In the meantime, we calculate the precise trailing twelve month volatility (contemplating the final 251 buying and selling day closing values in addition to at present’s value of $261.81) to be 25%. For extra put and name choices contract concepts value taking a look at, go to StockOptionsChannel.com.
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The views and opinions expressed herein are the views and opinions of the creator and don’t essentially replicate these of Nasdaq, Inc.
