First Week of November 18th Options Trading For FTD Companies (FTD)

Investors in FTD Companies Inc ( FTD) saw new options become available this week, for the November 18th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the FTD options chain for the new November 18th contracts and identified the following put contract of particular interest.

The put contract at the $20.00 strike price has a current bid of 35 cents. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $20.00, but will also collect the premium, putting the cost basis of the shares at $19.65 (before broker commissions). To an investor already interested in purchasing shares of FTD, that could represent an attractive alternative to paying $20.21/share today.

Because the $20.00 strike represents an approximate 1% 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 58%. 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 1.75% return on the cash commitment, or 70.97% annualized — at Stock Options Channel we call this the YieldBoost.

START SLIDESHOW:
Top YieldBoost Puts of the S&P 500 »

Below is a chart showing the trailing twelve month trading history for FTD Companies Inc, and highlighting in green where the $20.00 strike is located relative to that history:

If you liked this article you might like

What Valentine's Day and the Strong Dollar Can Tell You About Investing

Will Alibaba and Other Online Retailer Earnings Deliver? Here Are 4 Stocks to Watch

How Liberty's Expedia Spinoff Is Textbook John Malone

FTD Companies (FTD) Flagged As Strong On High Volume

BloomNation -- the ‘Etsy of Flowers’ -- Takes on Big Players