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Quantchabot has detected a promising Bull Call Spread trade opportunity for DEVON ENERGY (DVN) for the 12-Feb-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
DVN was recently trading at $19.62 and has an implied volatility of 65.40% for this period. Based on an analysis of the options available for DVN expiring on 12-Feb-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $19.62-$23.77 at expiration. In this scenario, the average linear return for the trade would be 62.62%.
Big 7.04% Change: After closing the last trading session at $18.33, DEVON ENERGY opened today at $18.72 and has reached a high of $19.64.
Trade approach: A movement as big as 7.04% is a significantly bullish indicator, so this trade is designed to be profitable if DVN maintains its current direction and does not revert back to pricing on the bearish side of $19.62 on 12-Feb-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 DEVON ENERGY closes at or above $19.60 on 12-Feb-2021. Based on our risk-neutral analysis, there is a 50.23% 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.