AstraZeneca Options Trading Sparks Investor Interest

AstraZeneca plc sees new options trading opportunities with put and call contracts. The current market conditions could provide favorable returns for investors looking to capitalize on AstraZeneca's stock price movements.

Date: 21-01-2025

AI Rating: 7

Options Trading Overview
Investors in AstraZeneca plc (AZN) have a new opportunity with options set to expire on September 19th. With the stock currently trading at $67.89, a put contract at the $67.50 strike price presents a potential scenario for investors to acquire shares at a lower effective price after accounting for the premium. Selling to open this put contract, which has a bid of $3.05, implies a cost basis of $64.45 if exercised.

Should the contract expire worthless, which has a probability of 55%, investors could see a return of 4.52% on their cash commitment, or an annualized return of 6.84%. This presents an attractive option for investors considering shares of AstraZeneca at the current market price.

Call Contract Discussion
On the other side, the call contract option at the $70.00 strike price offers another avenue for investors. If an investor purchases shares at $67.89 and sells a covered call at $70.00, they are set for a potential total return of 6.81% if the stock is called away. There's a 52% chance this call contract expires worthless, offering investors both premium income and retained ownership of the shares.

The potential returns from the covered call would be a 3.70% additional return (or 5.60% annualized), which makes this strategy noteworthy for investors who may not want to lock their shares away.

The implied volatility for the put contract stands at 25% and for the call at 26%, with an actual trailing twelve-month volatility observed at 21%. Such volatility measures indicate that market conditions are ripe for options trading around AstraZeneca.

Stocks: AZN