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Quantchabot has detected a promising Bull Call Spread trade opportunity for CSX (CSX) for the 16-Oct-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
CSX was recently trading at $80.61 and has an implied volatility of 27.32% for this period. Based on an analysis of the options available for CSX expiring on 16-Oct-2020, there is a 34.13% likelihood that the underlying will close within the analyzed range of $80.62-$87.33 at expiration. In this scenario, the average linear return for the trade would be 42.34%.
52 week high: CSX recently reached a new 52-week high at $80.65. CSX had traded in the range $46.81-$80.62 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 CSX maintains its current direction and does not revert back to pricing on the bearish side of $80.61 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 CSX closes at or above $80.04 on 16-Oct-2020. Based on our risk-neutral analysis, there is a 53.60% 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.