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Quantchabot has detected a promising Short Risk Reversal trade opportunity for EURONET WORLDWIDE (EEFT) for the 20-Mar-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
EEFT was recently trading at $145.22 and has an implied volatility of 27.02% for this period. Based on an analysis of the options available for EEFT expiring on 20-Mar-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $133.01-$145.48 at expiration. In this scenario, the average linear return for the trade would be 16.24%.
Big -8.05% Change: After closing the last trading session at $157.93, EURONET WORLDWIDE opened today at $149.98 and has reached a low of $144.93.
Trade approach: A movement as big as -8.05% is a significantly bearish indicator, so this trade is designed to be profitable if EEFT maintains its current direction and does not revert back to pricing on the bullish side of $145.22 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 bearish strategy, the trade would be profitable if EURONET WORLDWIDE closes at or below $146.20 on 20-Mar-2020. Based on our risk-neutral analysis, there is a 52.21% 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.