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Quantchabot has detected a promising Covered Put trade opportunity for DYNAVAX TECHNOLOGIES CORPORATI (DVAX) for the 17-Jul-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
DVAX was recently trading at $5.11 and has an implied volatility of 120.72% for this period. Based on an analysis of the options available for DVAX expiring on 17-Jul-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $3.18-$5.11 at expiration. In this scenario, the average linear return for the trade would be 111.11%.
Big -9.72% Change: After closing the last trading session at $5.66, DYNAVAX TECHNOLOGIES CORPORATI opened today at $5.40 and has reached a low of $5.07.
Trade approach: A movement as big as -9.72% is a significantly bearish indicator, so this trade is designed to be profitable if DVAX maintains its current direction and does not revert back to pricing on the bullish side of $5.11 on 17-Jul-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 DYNAVAX TECHNOLOGIES CORPORATI closes at or below $7.35 on 17-Jul-2020. Based on our risk-neutral analysis, there is a 77.82% 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.