Investors in Ford Motor Co. (Symbol: F) witnessed the commencement of trading for new options today, set to expire in December 2026. With 1074 days until expiration, these fresh contracts present a fascinating opportunity for puts or calls sellers to potentially obtain a higher premium compared to contracts with a closer expiration.
The put contract at the $8.00 strike price is currently listed at a bid of $1.03. Selling-to-open this put contract involves committing to purchase the stock at $8.00 while collecting the premium, thus setting the cost basis of the shares at $6.97 (before broker commissions). For an investor inclined towards acquiring F shares, this constitutes an appealing alternative to the current price of $11.85 per share.
Moreover, as the $8.00 strike signifies an approximately 32% discount to the stock’s current trading price (i.e., it is out-of-the-money by that percentage), there remains the possibility of the put contract expiring worthless. Current analytical data suggest a 99% chance of this outcome. Stock Options Channel will monitor these odds over time and present a chart of the numbers on their website. If the contract indeed expires worthless, the premium would yield a 12.88% return on the cash commitment, or 4.38% annualized — recognized as the YieldBoost at Stock Options Channel.
Visual data is provided below, showing the twelve-month trading history for Ford Motor Co., with the $8.00 strike highlighted for perspective:
On the calls side, the call contract at the $12.00 strike price boasts a current bid of $2.09. Utilizing a “covered call” strategy involves purchasing shares of F stock at the current price and selling-to-open the call contract, committing to sell the stock at $12.00. The call seller would also collect the premium, potentially driving a total return (excluding dividends, if any) of 18.90% at the December 2026 expiration (before broker commissions).
However, there is a caveat – if F shares significantly soar, the covered call strategy risks leaving significant potential upside on the table. Thus, analyzing the business fundamentals and studying Ford Motor Co.’s trailing twelve-month trading history becomes critical. The chart below showcases F’s twelve-month trading history, accentuating the $12.00 strike in red:
Considering the $12.00 strike represents an approximate 1% premium to the current trading price of the stock (out-of-the-money by that percentage), there is also the possibility of the covered call contract expiring worthless. Current analytical data indicate a 99% likelihood of this occurrence. Stock Options Channel will track these odds and publish a chart of the numbers on their website, along with the trading history of the option contract. Should the covered call contract expire worthless, the premium would amount to a 17.64% boost of extra return to the investor, or 5.99% annualized, referred to as the YieldBoost.
Furthermore, the actual trailing twelve-month volatility is calculated to be 36%. For further put and call options contract ideas, investors can explore StockOptionsChannel.com.