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Quantchabot has detected a promising Bear Put Spread trade opportunity for WEIBO CORPORATION AMERICAN DEP (WB) for the 17-Jul-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
WB was recently trading at $29.90 and has an implied volatility of 52.49% for this period. Based on an analysis of the options available for WB expiring on 17-Jul-2020, there is a 34.13% likelihood that the underlying will close within the analyzed range of $24.33-$29.91 at expiration. In this scenario, the average linear return for the trade would be 56.40%.
Big -9.64% Change: After closing the last trading session at $33.09, WEIBO CORPORATION AMERICAN DEP opened today at $32.05 and has reached a low of $29.89.
Trade approach: A movement as big as -9.64% is a significantly bearish indicator, so this trade is designed to be profitable if WB maintains its current direction and does not revert back to pricing on the bullish side of $29.90 on 17-Jul-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 WEIBO CORPORATION AMERICAN DEP closes at or below $30.05 on 17-Jul-2020. Based on our risk-neutral analysis, there is a 50.92% 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.