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Quantchabot has detected a promising Bull Call Spread trade opportunity for MOLINA HEALTHCARE (MOH) for the 20-Mar-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
MOH was recently trading at $140.70 and has an implied volatility of 35.92% for this period. Based on an analysis of the options available for MOH expiring on 20-Mar-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $140.95-$158.59 at expiration. In this scenario, the average linear return for the trade would be 41.29%.
Big 8.77% Change: After closing the last trading session at $129.35, MOLINA HEALTHCARE opened today at $128.55 and has reached a high of $141.79.
Trade approach: A movement as big as 8.77% is a significantly bullish indicator, so this trade is designed to be profitable if MOH maintains its current direction and does not revert back to pricing on the bearish side of $140.70 on 20-Mar-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 MOLINA HEALTHCARE closes at or above $140.20 on 20-Mar-2020. Based on our risk-neutral analysis, there is a 51.80% 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.