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Quantchabot has detected a promising Bear Call Spread trade opportunity for DILLARDS (DDS) for the 16-Oct-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
DDS was recently trading at $48.86 and has an implied volatility of 113.31% for this period. Based on an analysis of the options available for DDS expiring on 16-Oct-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $43.85-$48.86 at expiration. In this scenario, the average linear return for the trade would be 24.60%.
Big -8.59% Change: After closing the last trading session at $53.45, DILLARDS opened today at $54.04 and has reached a low of $48.84.
Trade approach: A movement as big as -8.59% is a significantly bearish indicator, so this trade is designed to be profitable if DDS maintains its current direction and does not revert back to pricing on the bullish side of $48.86 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 bearish strategy, the trade would be profitable if DILLARDS closes at or below $49.15 on 16-Oct-2020. Based on our risk-neutral analysis, there is a 52.18% 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.