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Quantchabot has detected a promising Bear Put Spread trade opportunity for TARGET (TGT) for the 15-May-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
TGT was recently trading at $92.55 and has an implied volatility of 54.01% for this period. Based on an analysis of the options available for TGT expiring on 15-May-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $76.31-$92.67 at expiration. In this scenario, the average linear return for the trade would be 57.39%.
Big -7.97% Change: After closing the last trading session at $100.56, TARGET opened today at $99.12 and has reached a low of $92.07.
Trade approach: A movement as big as -7.97% is a significantly bearish indicator, so this trade is designed to be profitable if TGT maintains its current direction and does not revert back to pricing on the bullish side of $92.55 on 15-May-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 TARGET closes at or below $93.50 on 15-May-2020. Based on our risk-neutral analysis, there is a 51.83% 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.