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Quantchabot has detected a promising Bull Call Spread trade opportunity for WEIBO CORPORATION AMERICAN DEP (WB) for the 21-Feb-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
WB was recently trading at $50.33 and has an implied volatility of 41.33% for this period. Based on an analysis of the options available for WB expiring on 21-Feb-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $50.42-$57.89 at expiration. In this scenario, the average linear return for the trade would be 54.43%.
Big 7.41% Change: After closing the last trading session at $46.86, WEIBO CORPORATION AMERICAN DEP opened today at $47.80 and has reached a high of $50.40.
Trade approach: A movement as big as 7.41% is a significantly bullish indicator, so this trade is designed to be profitable if WB maintains its current direction and does not revert back to pricing on the bearish side of $50.33 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 WEIBO CORPORATION AMERICAN DEP closes at or above $50.40 on 21-Feb-2020. Based on our risk-neutral analysis, there is a 50.13% 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.