Options Trading Unveiled for Phillips 66: Insights for Investors

Phillips 66 sees new options trading for July 18, with strategies for put and call contracts that could attract keen investors. The potential yield boosts indicate an intriguing opportunity worth considering.

Date: 09-04-2025

AI Rating: 7

Options Trading Analysis for Phillips 66

The recent report highlights new options trading for Phillips 66 (PSX), presenting investor opportunities via put and call options with July 18 expiration. Key aspects to analyze are the potential returns and market price implications of these options.

Investors interested in the put contract at a strike price of $85.00 can collect a premium of $6.30, equating to an effective purchase price of $78.70. This suggests a strategic buying approach, particularly as the strike price offers a discount of approximately 7% from the current trading price of $91.40. The odds of this contract expiring worthless are estimated at 66%, promoting confidence among potential sellers while hinting at possible price stabilization in the medium term.

The projected yield boost of 7.41% on this put contract signifies an appealing aspect for conservative investors preferring downside protection. Investors might lean into this option as a viable way to capitalize on Phillips 66’s price fluctuations without direct exposure to immediate share price volatility.

On the other hand, the report indicates a call contract priced at $100.00, with a bid of $5.20. Should the stock reach this strike price, investors could secure a return of 15.10% if called away. This highlights the potential for appreciation and profitable exit strategies, although it leaves room for missed upside should share prices significantly rise further.

The possibility of the call contract expiring worthless is pegged at 59%. Should this become reality, the additional return potential offers a significant incentive, with 20.77% annualized suggested yield boost. These factors could appeal to investors looking for strategies that combine income with potential capital appreciation.

Furthermore, the current implied volatilities of 54% for puts and 48% for calls indicate investor sentiment regarding potential price movements in Phillips 66. In comparison, the historical volatility stands at 32%, suggesting that current options may be priced higher due to anticipated market fluctuations. For investors, this underscores a need to weigh the possible risks and returns associated with these contracts.

Stocks: PSX