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Quantchabot has detected a promising Bull Call Spread trade opportunity for BILIBILI INC. AMERICAN DEPOSITARY SHARES (BILI) for the 21-Feb-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
BILI was recently trading at $21.30 and has an implied volatility of 48.57% for this period. Based on an analysis of the options available for BILI expiring on 21-Feb-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $21.35-$25.50 at expiration. In this scenario, the average linear return for the trade would be 33.27%.
Big 14.39% Change: After closing the last trading session at $18.62, BILIBILI INC. AMERICAN DEPOSITARY SHARES opened today at $19.47 and has reached a high of $21.48.
Trade approach: A movement as big as 14.39% is a significantly bullish indicator, so this trade is designed to be profitable if BILI maintains its current direction and does not revert back to pricing on the bearish side of $21.30 on 21-Feb-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 BILIBILI INC. AMERICAN DEPOSITARY SHARES closes at or above $21.10 on 21-Feb-2020. Based on our risk-neutral analysis, there is a 52.68% 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.