Etsy Inc Options Trading Offers Premium Potential for Investors

Investors in Etsy Inc are presented with promising new options contracts with significant potential for premium returns, as detailed in a recent report. The strategic put and call contracts could provide favorable opportunities depending on market movements.

Date: 17-09-2024

AI Rating: 7

The report highlights new options trading for Etsy Inc (ETSY), providing insights into put and call contracts that may impact stock prices depending on investor activity.

The put contract at a $50.00 strike price, with a current bid of $10.80, allows investors an attractive entry point for purchasing shares, lowering the effective cost basis to $39.20. Given its out-of-the-money status (8% discount to current prices) and a 74% chance of expiration worthless, it can yield a 21.60% return on cash commitment if exercised.

The call contract, priced at a $65.00 strike, carries a bid of $12.55 and represents a 20% premium to the current $54.07 share price. If the stock is called away at expiration, it would result in a 43.43% total return, although there’s a 41% chance it could expire worthless, allowing the investor to keep their shares and the premium collected.

The current implied volatilities for the put (53%) and call (45%) contracts also suggest varying market expectations, which could make these options attractive for certain strategies. Additionally, the report mentions a trailing twelve-month volatility of 44%, providing context for ongoing price movements.

Stocks: ETSY