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Quantchabot has detected a promising Bull Put Spread trade opportunity for JOHNSON CONTROLS (JCI) for the 29-Jan-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
JCI was recently trading at $51.63 and has an implied volatility of 31.42% for this period. Based on an analysis of the options available for JCI expiring on 29-Jan-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $51.64-$55.18 at expiration. In this scenario, the average linear return for the trade would be 46.34%.
52 week high: JOHNSON CONTROLS recently reached a new 52-week high at $52.03. JCI had traded in the range $22.77-$51.57 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 JCI maintains its current direction and does not revert back to pricing on the bearish side of $51.63 on 29-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 JOHNSON CONTROLS closes at or above $51.35 on 29-Jan-2021. Based on our risk-neutral analysis, there is a 53.36% 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.