- Implied Volatility in the 3rd percentile is at the same level as it was before the Covid-19 vaccine. Volatility spikes driven by news aren't priced in.
- Options volatility is also skewed negative and pricing in a $0.10 drop. Historically, this marks great buying opportunities as investors are over bearish.
- The recent earnings report was a flop, but some tension has been released as we now know that the dividend after the Viatris spinnoff won't be meaningfully impacted.
- Gaining exposure by buying call options gives us leveraged upside while limiting any catalyst driven downside risk as options premiums will rise with volatility.
For further details see:
Forget Pfizer Stock, Buy Historically Cheap Call Options