Recommendation: ST
Current Price: $3.46
Total Wheels: 16
EditTypically you want to choose options that have a higher than 70% chance of being out of the money, since then you only have a 30% chance of actually acquiring the stock. Beyond that maximumizing the annualized rate of return is a good idea.
Annualized rate of return is computed fairly bullish as (max_return * odds + (1 - odds)) ^ (252 / calendar_days). This assumes that if you accidently acquire the stock you will be able to do something such that effectively get you a 1x return immediately.
| Ticker | Strike | Premium | Ticker Price | Calendar Days To Expiration | Odds Out Of The Money % | Maximum Return % | Annualized Rate Of Return |
|---|---|---|---|---|---|---|---|
| BB | 3.0 | 0.02 | 3.46 | 5 (2026-02-13) | 91.25% | 0.67% | 1.36x |
| BB | 2.5 | 0.39 | 3.46 | 510 (2028-01-21) | 79.83% | 15.60% | 1.06x |
| BB | 2.0 | 0.21 | 3.46 | 510 (2028-01-21) | 87.65% | 10.50% | 1.04x |