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Quantchabot has detected a promising Bull Call Spread trade opportunity for LENNAR (LEN) for the 19-Jun-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
LEN was recently trading at $48.60 and has an implied volatility of 55.50% for this period. Based on an analysis of the options available for LEN expiring on 19-Jun-2020, there is a 34.13% likelihood that the underlying will close within the analyzed range of $48.63-$60.01 at expiration. In this scenario, the average linear return for the trade would be 50.35%.
Big 7.14% Change: After closing the last trading session at $45.36, LENNAR opened today at $48.22 and has reached a high of $49.38.
Trade approach: A movement as big as 7.14% is a significantly bullish indicator, so this trade is designed to be profitable if LEN maintains its current direction and does not revert back to pricing on the bearish side of $48.60 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 LENNAR closes at or above $48.25 on 19-Jun-2020. Based on our risk-neutral analysis, there is a 51.49% 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.