Tesla has outperformed in June for the past 10 years
The S&P 500 (SPX) made history last month, after it recorded double digit gains through May for just the second time in over two decades. However, June tends to be a
bearish month for the index. For that reason, we are honing in on some of the best-performing stocks to own in June. Electric vehicle giant
Tesla Inc (NASDAQ:TSLA) stands out as one of them. Below, we will take a closer look at how TSLA has performed of late, and explore why now could be a good time to buy options.
According to Schaeffer's Senior Quantitative Analyst Rocky White, TSLA has averaged a gain of 10.7% in the month of June over the last 10 years. Plus, the security has finished the month in the black eight times. In other words, the equity is among the top three best stocks to own this month, and is the only automobile name to appear on the list above.
At last check, the security is down 2.7% at $606.86. Still, a move of similar magnitude would put TSLA just above $670 for the first time since early May. And although shares are off 14% year-to-date, a floor seems to have emerged at the round $600 level, with additional support coming from the 200-day moving average
Options traders are speculating on more upside for the security. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), TSLA's 10-day call/put volume ratio of 1.66 sits higher than 71% of readings from the past year. In other words, calls are getting picked up at a quicker-than-usual clip.
Now seems to be a prime time to purchase TSLA options. That's because security's Schaeffer's Volatility Index (SVI) of 47% stands in the extremely low first percentile of its annual range. This means option traders are pricing in low volatility expectations at the moment.
What's more, these premium buyers are striking while the iron is hot, considering TSLA has consistently rewarded options buyers over the past year. This is per the security's Schaeffer's Volatility Scorecard (SVS), which ranks at a high 98 out of a possible 100.