CLF January 2026 Options Begin Trading

Stock Options Channel highlights two option strategies on Cleveland‑Cliffs (CLF, $13.10): selling the Jan‑2026 $12.50 put (bid $0.50) sets an effective buy price of $12.00, is ~5% out‑of‑the‑money with a modeled 62% chance of expiring worthless, and would yield 4.00% on cash committed (29.20% annualized, “YieldBoost”); alternatively, selling the Jan‑2026 $14.00 covered call (bid $0.50) while long at $13.10 would cap proceeds at $14.00 for a 10.69% total return if called, is ~7% OTM with a 49% chance to expire worthless, and would add a 3.82% premium (27.86% annualized). Implied volatilities are elevated (puts 107%, calls 109%) versus trailing 12‑month realized volatility of 77%, and the service will track changing odds and option histories—investors should weigh the premium income against the risk of being assigned or foregoing upside and assess fundamentals before implementing either trade.

Analysis

Stock Options Channel presents two short-option strategies on Cleveland-Cliffs (CLF, $13.10). Selling the $12.50 put at a $0.50 bid would set an effective purchase price of $12.00 before commissions, with the $12.50 strike ~5% out-of-the-money and the modelled odds of expiring worthless at 62%, producing a 4.00% cash return (29.20% annualized, labelled "YieldBoost").

Selling the $14.00 call at a $0.50 bid as a covered-call while owning shares at $13.10 would cap proceeds at $14 and deliver a 10.69% total return if called; the $14 strike is ~7% OTM with a 49% chance to expire worthless and would add a 3.82% premium (27.86% annualized).

Implied volatility is elevated (puts 107%, calls 109%) versus trailing 12-month realized volatility of 77%, indicating option premiums are rich and compensation for higher expected moves; primary risks are assignment on the put, foregoing upside above $14 on the covered call, and sensitivity to volatility contraction or expansion. The service will monitor odds and Greeks over time, so execution should reflect both option-implied signals and CLF fundamentals.

Key Decisions for Investors

• Consider selling the $12.50 put only if you are willing to own CLF at an effective $12.00 cost basis after commissions, since the trade offers a 4.00% return with a modelled 62% chance to expire worthless
• If already long CLF, consider writing the $14 covered call to capture the $0.50 premium and lock a 10.69% realized upside to $14, but be prepared to forfeit gains above $14 given the 49% chance the option expires worthless
• Limit position size or avoid naked short exposure because implied vol (107–109%) materially exceeds realized vol (77%), signaling expensive premiums and elevated tail-risk—use hedges or buy protection if needed
• Monitor the published odds, Greeks and changes in implied volatility closely and re-evaluate these plays if implied vol contracts or the modelled expiration probabilities shift materially, and confirm alignment with your fundamental view of CLF