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Quantchabot has detected a promising Bull Put Spread trade opportunity for HOME BANCSHARES (HOMB) for the 19-Jun-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
HOMB was recently trading at $15.04 and has an implied volatility of 47.57% for this period. Based on an analysis of the options available for HOMB expiring on 19-Jun-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $14.92-$17.86 at expiration. In this scenario, the average linear return for the trade would be 16.23%.
Big 7.10% Change: After closing the last trading session at $14.04, HOME BANCSHARES opened today at $14.56 and has reached a high of $15.05.
Trade approach: A movement as big as 7.10% is a significantly bullish indicator, so this trade is designed to be profitable if HOMB maintains its current direction and does not revert back to pricing on the bearish side of $15.04 on 19-Jun-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 HOME BANCSHARES closes at or above $14.30 on 19-Jun-2020. Based on our risk-neutral analysis, there is a 59.27% 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.