COST Costco (COST) options offer exposure to the premium membership retailer with steady growth, defensive characteristics, and a high share price requiring spread strategies.

COST's high share price means options are expensive in absolute terms. Spread strategies are essential for capital efficiency. Monthly sales data creates regular catalysts.

COST Options Characteristics

Avg Daily Volume

150K+ contracts

Typical Spread

$0.10-0.30

Typical IV Rank

15-30%

Expirations

Weekly, Monthly, Quarterly, LEAPS

Price Range

$700-1000

Correlation

Moderate correlation with consumer staples and retail

Best Strategies for COST

Bull Call Spreads

Capital-efficient bullish exposure

Iron Condors

Defined-risk income on expensive underlying

Put Credit Spreads

Bullish income below strong support

LEAPS Calls

Long-term growth thesis at reduced cost

Diagonal Spreads

Reduce cost on high-priced options

Membership Moat

Costco's high share price means a single at-the-money call can cost $3,000+. Spread strategies (verticals, iron condors) are essential for most traders to maintain position sizing discipline.

COST Options FAQ

Why are Costco options so expensive?

COST's high share price ($700-1000) makes individual options contracts costly. A single ATM call can cost $3,000+. Use vertical spreads, iron condors, or LEAPS to manage capital requirements.

When does Costco report that affects options?

Besides quarterly earnings, COST reports monthly same-store sales — unique among retailers. These monthly reports create regular mini-catalysts that can move the stock 2-4%.