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Quantchabot has detected a promising Bull Put Spread trade opportunity for MONGODB INC. CLASS A COMMON STOCK (MDB) for the 27-Nov-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
MDB was recently trading at $267.22 and has an implied volatility of 50.13% for this period. Based on an analysis of the options available for MDB expiring on 27-Nov-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $267.27-$317.03 at expiration. In this scenario, the average linear return for the trade would be 63.30%.
52 week high: MONGODB INC. CLASS A COMMON STOCK recently reached a new 52-week high at $272.56. MDB had traded in the range $93.81-$272.55 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 MDB maintains its current direction and does not revert back to pricing on the bearish side of $267.22 on 27-Nov-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 MONGODB INC. CLASS A COMMON STOCK closes at or above $266.70 on 27-Nov-2020. Based on our risk-neutral analysis, there is a 50.49% 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.