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Quantchabot has detected a promising Bull Put Spread trade opportunity for DOCUSIGN INC. COMMON STOCK (DOCU) for the 26-Feb-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
DOCU was recently trading at $258.50 and has an implied volatility of 50.17% for this period. Based on an analysis of the options available for DOCU expiring on 26-Feb-2021, there is a 34.13% likelihood that the underlying will close within the analyzed range of $258.54-$308.55 at expiration. In this scenario, the average linear return for the trade would be 70.54%.
Big 7.28% Change: After closing the last trading session at $240.96, DOCUSIGN INC. COMMON STOCK opened today at $245.57 and has reached a high of $260.00.
Trade approach: A movement as big as 7.28% is a significantly bullish indicator, so this trade is designed to be profitable if DOCU maintains its current direction and does not revert back to pricing on the bearish side of $258.50 on 26-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 DOCUSIGN INC. COMMON STOCK closes at or above $258.50 on 26-Feb-2021. Based on our risk-neutral analysis, there is a 50.04% 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.