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Quantchabot has detected a promising Bull Put Spread trade opportunity for COCA-COLA (KO) for the 17-Apr-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
KO was recently trading at $59.61 and has an implied volatility of 11.17% for this period. Based on an analysis of the options available for KO expiring on 17-Apr-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $59.79-$63.28 at expiration. In this scenario, the average linear return for the trade would be 60.75%.
52 week high: COCA-COLA recently reached a new 52-week high at $59.79. KO had traded in the range $44.42-$59.45 over the past year.
Trade approach: Reaching a new 52-week high is a bullish indicator, so this trade is designed to be profitable if KO maintains its current direction and does not revert back to pricing on the bearish side of $59.61 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 COCA-COLA closes at or above $59.05 on 17-Apr-2020. Based on our risk-neutral analysis, there is a 58.72% 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.