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Quantchabot has detected a promising Bull Put Spread trade opportunity for ALBEMARLE (ALB) for the 16-Oct-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
ALB was recently trading at $99.21 and has an implied volatility of 42.23% for this period. Based on an analysis of the options available for ALB expiring on 16-Oct-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $98.83-$111.84 at expiration. In this scenario, the average linear return for the trade would be 64.29%.
52 week high: ALBEMARLE recently reached a new 52-week high at $100.31. ALB had traded in the range $48.89-$99.81 over the past year.
Trade approach: Reaching a new 52-week high is a bullish indicator, so this trade is designed to be profitable if ALB maintains its current direction and does not revert back to pricing on the bearish side of $99.21 on 16-Oct-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 ALBEMARLE closes at or above $98.00 on 16-Oct-2020. Based on our risk-neutral analysis, there is a 52.73% 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.