GameStop Corp Options: September 19th Expiration

GameStop Corp. (GME) investors can consider new options available for the September 19th expiration. The $18.00 put contract has a current bid of 50 cents, and selling it could result in a 2.78% return on the cash commitment. The $26.00 call contract has a current bid of $1.56, and purchasing it could result in a 21.25% total return if the stock gets called away.

GameStop Corp. (GME) investors have new options to consider with the availability of contracts for the September 19th expiration. The latest options data provides insights into potential opportunities for both puts and calls.

The $18.00 put contract has a current bid of 50 cents. Selling this put contract would commit the investor to purchase the stock at $18.00, but they would also collect the premium, reducing the effective cost basis to $17.50 (before broker commissions). This represents an attractive alternative to the current market price of $22.73 per share. The put contract is out-of-the-money by approximately 21%, with an 82% chance of expiring worthless. If the contract does expire worthless, the premium would represent a 2.78% return on the cash commitment, or 14.08% annualized, as calculated by Stock Options Channel [1].

On the call side, the $26.00 call contract has a current bid of $1.56. Purchasing this call contract and selling it as a "covered call" would commit the investor to sell the stock at $26.00, resulting in a total return (excluding dividends) of 21.25% if the stock gets called away at the September 19th expiration. The call contract is out-of-the-money by approximately 14%, with a 58% chance of expiring worthless. If the covered call contract expires worthless, the premium would represent a 6.86% boost, or 34.79% annualized, as calculated by Stock Options Channel [1].

Both options contracts offer potential returns, with the put providing a lower-risk, lower-return opportunity and the call offering higher potential returns but with increased risk. Investors should consider their risk tolerance and investment goals when evaluating these options. The implied volatility for the put contract is 71%, while the call contract has an implied volatility of 75%. The actual trailing twelve-month volatility is 68%.

The availability of these new options provides GME investors with additional strategies to potentially enhance their returns or manage risk. As always, investors should conduct thorough research and consider their individual financial circumstances before making any investment decisions.

References:
[1] https://www.nasdaq.com/articles/interesting-gme-put-and-call-options-september-19th
[2] https://cryptofrontnews.com/bitcoin-etf-inflows-return-as-fidelity-boosts/