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Quantchabot has detected a promising Bull Call Spread trade opportunity for ELI LILLY (LLY) for the 17-Apr-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
LLY was recently trading at $132.56 and has an implied volatility of 23.65% for this period. Based on an analysis of the options available for LLY expiring on 17-Apr-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $132.64-$151.35 at expiration. In this scenario, the average linear return for the trade would be 156.90%.
Big 8.71% Change: After closing the last trading session at $121.94, ELI LILLY opened today at $123.29 and has reached a high of $133.88.
Trade approach: A movement as big as 8.71% is a significantly bullish indicator, so this trade is designed to be profitable if LLY maintains its current direction and does not revert back to pricing on the bearish side of $132.56 on 17-Apr-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 ELI LILLY closes at or above $132.42 on 17-Apr-2020. Based on our risk-neutral analysis, there is a 50.49% 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.