360° Coverage : March 22nd Options Now Available For PPL

2 Updates
March 22nd Options Now Available For PPL

March 22nd Options Now Available For PPL

Jan 21 2014, 10:51am CST | by

Investors in PPL Corp (NYSE: PPL) saw new options begin trading today, for the March 22nd expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the PPL options chain...

Filed under: news

 
 
 

34 weeks ago

March 22nd Options Now Available For PPL

Jan 21 2014, 10:51am CST | by

Investors in PPL Corp (NYSE: PPL) saw new options begin trading today, for the March 22nd expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the PPL options chain for the new March 22nd contracts and identified one put and one call contract of particular interest.

The put contract at the $29.0 strike price has a current bid of 45 cents. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $29.0, but will also collect the premium, putting the cost basis of the shares at $28.55 (before broker commissions). To an investor already interested in purchasing shares of PPL, that could represent an attractive alternative to paying $29.66/share today.

Because the $29.0 strike represents an approximate 2% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 61%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 1.55% return on the cash commitment, or 9.45% annualized — at Stock Options Channel we call this the YieldBoost.

Click here to find out the Top YieldBoost Puts of the S&P 500 »

Below is a chart showing the trailing twelve month trading history for PPL Corp, and highlighting in green where the $29.0 strike is located relative to that history:

Turning to the calls side of the option chain, the call contract at the $30.0 strike price has a current bid of 35 cents. If an investor was to purchase shares of PPL stock at the current price level of $29.66/share, and then sell-to-open that call contract as a “covered call,” they are committing to sell the stock at $30.0. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 2.33% if the stock gets called away at the March 22nd expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if PPL shares really soar, which is why looking at the trailing twelve month trading history for PPL Corp, as well as studying the business fundamentals becomes important. Below is a chart showing PPL’s trailing twelve month trading history, with the $30.0 strike highlighted in red:

Considering the fact that the $30.0 strike represents an approximate 1% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 60%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 1.18% boost of extra return to the investor, or 7.18% annualized, which we refer to as the YieldBoost.

Click here to find out the Top YieldBoost Calls of the S&P 500 »

The implied volatility in the put contract example is 16%, while the implied volatility in the call contract example is 15%. Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 251 trading day closing values as well as today’s price of $29.66) to be 14%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.

Source: Forbes Business

 
Update
2

3 weeks ago

Khazanah throws MAS RM6b lifeline

Aug 29 2014 5:01pm CDT | Source: Business Times Singapore

August 30, 2014 1:15 AMKHAZANAH Nasional will inject RM6 billion (SS$2.4 billion) over three years to resuscitate loss-making Malaysia Airlines (MAS) under a recovery plan that includes even an Act of Parliament. Other key moves are migrating its operations, assets and liabilities to a new com ...
Source: Business Times Singapore   Full article at: Business Times Singapore
 

 
Update
1

3 weeks ago

MAS posts loss of RM307m for Q2

Aug 28 2014 5:00pm CDT | Source: Business Times Singapore

August 29, 2014 1:13 AMMALAYSIA Airlines (MAS) registered a loss of RM307 million (S$122 million) for the second quarter to end-June, but warned of worse to come in the second half when the "full financial impact of the double tragedies of MH370 and MH17 ...
Source: Business Times Singapore   Full article at: Business Times Singapore
 

 

Don't miss ...

 

<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

blog comments powered by Disqus

Latest stories

Liquid metal batteries to herald new future
Washington, Sep 23 (IANS) Researchers have improved a liquid battery system that could enable renewable energy resources to compete with conventional power plants.
 
 
Obesity increases risk of stress-related diseases
New York, Sep 23 (IANS) If you are overweight, you may be at greater risk of contracting stress-related diseases like type 2 diabetes, heart disease and cancer, says a study.
 
 
Young and overweight? Try this exercise combo
Toronto, Sep 23 (IANS) Combining aerobics with resistance training may be the best exercise for obese teenagers, says a study.
 
 
Arctic Sea ice helps balancing CO2 level
London, Sep 23 (IANS) Arctic Sea ice removes carbon dioxide (CO2) from the atmosphere and if Arctic Sea ice is reduced further, we will be face an increase in atmospheric concentration of CO2, says a study.
 
 
 

Latest from the Network

No deal yet on new n-proposal: Iran
Tehran, Sep 23 (IANS) Ths parties present in the ongoing nuclear talks between Iran and the six world powers have not reached any agreement on the new proposal of the West as a step to resolve the nuclear issue of the...
Read more on Politics Balla
 
Tricks to switch from summer to autumn make-up
London, Sep 23 (IANS) Autumn season calls not only for wardrobe change, but also the makeover of make-up kit. An expert suggests how you can transform make-up from summer to autumn subtly. Natasha Daniel, a head make-...
Read more on Celebrity Balla
 
Syria confirms downing of its aircraft by Israel
Damascus, Sep 23 (IANS/EFE) Syria confirmed Tuesday that the Israeli military shot down one of its aircraft over the tense border between the two countries in the Golan Heights, Syrian state television reported. In a...
Read more on Politics Balla
 
Danny O'Donoghue doesn't own a car
Los Angeles, Sep 23 (IANS) Danny O'Donoghue, the lead singer of The Script band, has revealed that he doesn't own a car. In an interview with The Sun newspaper, the singer, who along with his bandmates has given hits...
Read more on Celebrity Balla
 
NRAI congratulates Bindra
London, Sep 23 (IANS) National Rifle Association of India (NRAI) president Raninder Singh congratulated Olympic champion Abhinav Bindra Tuesday for winning his first Asian Games individual medal, a men's 10 metre air...
Read more on Sport Balla
 
Arctic Sea ice helps balancing CO2 level
London, Sep 23 (IANS) Arctic Sea ice removes carbon dioxide (CO2) from the atmosphere and if Arctic Sea ice is reduced further, we will be face an increase in atmospheric concentration of CO2, says a study. Because of...
Read more on Politics Balla
 
Robert Pattinson, FKA Twigs get cosy
Los Angeles, Sep 23 (IANS) Rumoured couple Robert Pattinson and singer FKA Twigs were spotted getting cosy at Venice Beach in California. Fans captured the stars holding hands as they enjoyed a romantic stroll on the...
Read more on Celebrity Balla
 
Suicides by Indians in Oman on decline
Muscat, Sep 23 (IANS) There has been a fall in the number of suicides by Indians in Oman this year, according to Indian embassy data. On an average, five Indians committed suicide every month in 2013, but this year...
Read more on Politics Balla
 
Harpreet 7th in 25m rapid fire pistol qualifiers
Incheon, Sep 23 (IANS) India's Harpreet Singh finished seventh as Gurpreet Singh and Pemba Tamang failed to impress in the men's 25 metre rapid fire pistol qualification stage 1 of the Asian Games at the Ongnyeon...
Read more on Sport Balla
 
Afghanistan peace depends on US, Pakistan cooperation: Karzai
Kabul, Sep 23 (IANS) Outgoing Afghan President Hamid Karzai Tuesday said that returning durable peace to his conflict-ridden country depends on the cooperation from the US and Pakistan. "Peace in Afghanistan depends...
Read more on Politics Balla