Big Gainer Alert: Trading today’s 7.0% move in TRANSOCEAN $RIG

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Quantchabot has detected a promising Bull Call Spread trade opportunity for TRANSOCEAN (RIG) for the 27-Mar-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

RIG was recently trading at $4.80 and has an implied volatility of 68.16% for this period. Based on an analysis of the options available for RIG expiring on 27-Mar-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $4.80-$6.12 at expiration. In this scenario, the average linear return for the trade would be 60.01%.

Big 7.03% Change: After closing the last trading session at $4.48, TRANSOCEAN opened today at $4.60 and has reached a high of $4.82.

Trade approach: A movement as big as 7.03% is a significantly bullish indicator, so this trade is designed to be profitable if RIG maintains its current direction and does not revert back to pricing on the bearish side of $4.80 on 27-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 TRANSOCEAN closes at or above $4.80 on 27-Mar-2020. Based on our risk-neutral analysis, there is a 50.16% 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.