July 15 options now available for Hartford Financial Services Group (HIG)

0

IInvestors at Hartford Financial Services Group Inc. (Ticker: HIG) saw new options become available today, for July 15 expiry. To Stock Options Channelour YieldBoost formula scoured the HIG options chain for July 15 new contracts and identified one particularly attractive put and one call.

The contract to sell at the strike price of $65.00 has a current bid of 85 cents. If an investor were to sell to open this put contract, they agree to buy the stock at $65.00, but will also collect the premium, placing the cost base of the stock at $64.15 (before brokerage commissions ). For an investor already interested in buying shares of HIG, this could represent an attractive alternative to paying $67.47/share today.

Since the strike price of $65.00 represents a discount of approximately 4% from the current stock price (in other words, it is out of play by that percentage), it is also possible that the contract of sale expires worthless. Current analytical data (including Greeks and implied Greeks) suggests that the current chance of this happening is 99%. Stock Options Channel will track these odds over time to see how they change, posting a table of these numbers on our website under contract detail page for this contract. If the contract expires worthless, the premium would represent a return of 1.31% on the cash commitment, or 8.37% annualized – at Stock Options Channel, we call this the Yield increase.

Below is a graph showing the last twelve months trading history for Hartford Financial Services Group Inc., and highlighting in green where the strike price of $65.00 falls in relation to this history. :

On the call side of the options chain, the call contract at the strike price of $70.00 has a current bid of 65 cents. If an investor were to buy HIG stock at the current price level of $67.47/share and then sell to open this call contract as a “covered call”, they are committing to selling the stock at 70 $.00. Assuming that the call seller will also collect the premium, this would result in a total return (excluding dividends, if any) of 4.71% if the stock is called at the July 15 expiry (before brokerage commissions). Of course, a lot of upside could potentially be left on the table if HIG stock really does soar, which is why it becomes important to look at Hartford Financial Services Group Inc.’s past 12-month trading history, as well than studying the fundamentals of business. Below is a chart showing HIG’s trading history over the last twelve months, with the $70.00 strike highlighted in red:

Loading+Chart+—+2022+TickerTech.com

Considering that the strike price of $70.00 represents a premium of approximately 4% to the current stock price (in other words, it is out of the price by that percentage), it It is also possible for the covered call contract to expire worthless, in which case the investor would keep both his shares and the premium collected. Current analytical data (including Greeks and implied Greeks) 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 odds over time to see how they change and publish a chart of these numbers (the option contract’s trading history will also be charted). If the covered call expires worthless, the premium would represent an increase of 0.96% in incremental return to the investor, or 6.17% annualized, what we call the Yield increase.

Meanwhile, we calculate the actual volatility for the last twelve months (considering the closing values ​​for the last 253 trading days as well as today’s price of $67.47) at 23%. For more put and call options contract ideas worth considering, visit StockOptionsChannel.com.

Top S&P 500 YieldBoost Calls »

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Share.

About Author

Comments are closed.