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Quantchabot has detected a promising Bull Put Spread trade opportunity for FARFETCH LTD (FTCH) for the 15-Jan-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
FTCH was recently trading at $48.18 and has an implied volatility of 71.08% for this period. Based on an analysis of the options available for FTCH expiring on 15-Jan-2021, there is a 34.13% likelihood that the underlying will close within the analyzed range of $48.19-$64.80 at expiration. In this scenario, the average linear return for the trade would be 64.99%.
Big 11.50% Change: After closing the last trading session at $43.21, FARFETCH LTD opened today at $48.65 and has reached a high of $50.36.
Trade approach: A movement as big as 11.50% is a significantly bullish indicator, so this trade is designed to be profitable if FTCH maintains its current direction and does not revert back to pricing on the bearish side of $48.18 on 15-Jan-2021. 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 FARFETCH LTD closes at or above $47.55 on 15-Jan-2021. Based on our risk-neutral analysis, there is a 51.81% 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.