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Quantchabot has detected a promising Bull Call Spread trade opportunity for ZYNGA (ZNGA) for the 17-Apr-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
ZNGA was recently trading at $6.76 and has an implied volatility of 29.87% for this period. Based on an analysis of the options available for ZNGA expiring on 17-Apr-2020, there is a 34.13% likelihood that the underlying will close within the analyzed range of $6.78-$7.74 at expiration. In this scenario, the average linear return for the trade would be 30.92%.
Big 14.00% Change: After closing the last trading session at $5.93, ZYNGA opened today at $6.41 and has reached a high of $6.88.
Trade approach: A movement as big as 14.00% is a significantly bullish indicator, so this trade is designed to be profitable if ZNGA maintains its current direction and does not revert back to pricing on the bearish side of $6.76 on 17-Apr-2020. If possible, the trade has been padded such that slight movement against the trade would still return a profit.
Upside potential: Using this bullish strategy, the trade would be profitable if ZYNGA closes at or above $6.74 on 17-Apr-2020. Based on our risk-neutral analysis, there is a 51.88% likelihood of this return.
Downside risk: As with any options trade, there is a substantial downside risk where you may lose most or all of your investment.
To analyze this trade in depth, please visit the Quantcha Options Search Engine.