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Quantchabot has detected a promising Bull Put Spread trade opportunity for APACHE (APA) for the 21-Feb-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
APA was recently trading at $30.90 and has an implied volatility of 46.22% for this period. Based on an analysis of the options available for APA expiring on 21-Feb-2020, there is a 34.13% likelihood that the underlying will close within the analyzed range of $30.72-$36.15 at expiration. In this scenario, the average linear return for the trade would be 60.22%.
Big 20.51% Change: After closing the last trading session at $25.64, APACHE opened today at $29.93 and has reached a high of $30.98.
Trade approach: A movement as big as 20.51% is a significantly bullish indicator, so this trade is designed to be profitable if APA maintains its current direction and does not revert back to pricing on the bearish side of $30.90 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 APACHE closes at or above $30.39 on 21-Feb-2020. Based on our risk-neutral analysis, there is a 52.61% 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.