Annualized Static Rate of Return
Summary of User’s Concern and Solutions Discussed:
- The main problem reported by the user is that Fidelity does not display the annualized static rate of return on their option chain, unlike other brokers.
- Fidelity confirmed that the annualized static rate of return is available for specific strategies (Cash covered put and Buy write) through their new “Options Analysis & Research” experience.
- To access this information, users should log into Fidelity.com, navigate to the option chain, and click the banner to switch to the new experience. Then, they can select the appropriate strategy from the “Option Strategy” dropdown menu to find the static rate of return data.
- For calculating the annualized rate of return, the formula provided by Fidelity is to multiply the static rate of return by (365 divided by the number of days to expiration).
Here’s the full thread
How come Fidelity doesn’t provide the annualized static ROR on their option chain like other brokers do?
Thanks for reaching out to us, @jce.
We’d like to conduct some additional research on this. Once we have more information, we’ll follow up with you here. 🟢
I see in some fidelidy documentation how to determine the Annualized Rate of Return but why not show that on the option chain so the customer doesn’t have to figure it out on their own?
See fidelity doc at : extension://efaidnbmnnnibpcajpcglclefindmkaj/https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/OptionsForIncome_Webinar.pdf]
Thanks for being patient with us while we researched this, @jce. I’m happy to chime in here with our findings.
We’ve confirmed that the annualized static rate of return data is available for the Cash covered put and Buy write option strategies in the option chain, which is part of the new “Options Analysis & Research” experience that launched recently.
That said, it may require navigating to the new experience first. If necessary, log into Fidelity.com and navigate to the option chain, then click the banner at the top of the classic experience. This will launch the new experience. You can then find the static rate of return information by following the steps below:
1. Navigate to the “Option Strategy” dropdown menu on the left
2. Select either “Cash covered put” or “Buy write”
3. Locate the “Static rate of return” data
If there is anything else we can help with, please let us know.
Options trading entails significant risk and is not appropriate for all investors. Certain complex options strategies carry additional risk. Before trading options, please read the Characteristics and Risks of Standardized Options (http://www.optionsclearing.com/about/publications/character-risks.jsp). Supporting documentation for any claims, if applicable, will be furnished upon request.🟢
@FidelityHeather How do I anualize that number? Do I multiply the “Static rate of return” value by the number of days until expiration and then divide that by 366 to get the annulized rate of return?
Happy to clarify. The simple formula is (Static Rate of Return) x (365/number of days to expiration).
Keep in mind that the actual, achieved annualized RoR may differ due to changing market conditions.