Quantcha now offering unlimited commission-free options trading.
Quantchabot has detected a promising Bull Put Spread trade opportunity for MICROSOFT (MSFT) for the 24-Jan-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
MSFT was recently trading at $157.23 and has an implied volatility of 16.92% for this period. Based on an analysis of the options available for MSFT expiring on 24-Jan-2020, there is a 34.13% likelihood that the underlying will close within the analyzed range of $157.43-$164.63 at expiration. In this scenario, the average linear return for the trade would be 50.55%.
52 week high: MICROSOFT recently reached a new 52-week high at $159.02. MSFT had traded in the range $96.40-$158.73 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 MSFT maintains its current direction and does not revert back to pricing on the bearish side of $157.23 on 24-Jan-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 MICROSOFT closes at or above $156.66 on 24-Jan-2020. Based on our risk-neutral analysis, there is a 54.36% 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.