Investors in Advance Auto Parts Inc (AAP) saw new options begin trading this week, for the September 20th expiration. One of the key data points that goes into the price an option buyer is willing to pay, is the time value, so with 241 days until expiration the newly trading contracts represent a possible opportunity for sellers of puts or calls to achieve a higher premium than would be available for the contracts with a closer expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the AAP options chain for the new September 20th contracts and identified one put and one call contract of particular interest.The put contract at the $115.00 strike price has a current bid of $8.00. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $115.00, but will also collect the premium, putting the cost basis of the shares at $107.00 (before broker commissions). To an investor already interested in purchasing shares of AAP, that could represent an attractive alternative to paying $117.21/share today.
First Week Of AAP September 20th Options Trading
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts