Big Gainer Alert: Trading today’s 8.2% move in BAIDU $BIDU

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Quantchabot has detected a promising Bull Put Spread trade opportunity for BAIDU (BIDU) for the 19-Feb-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

BIDU was recently trading at $256.27 and has an implied volatility of 74.44% for this period. Based on an analysis of the options available for BIDU expiring on 19-Feb-2021, there is a 34.13% likelihood that the underlying will close within the analyzed range of $256.30-$324.11 at expiration. In this scenario, the average linear return for the trade would be 96.12%.

Big 8.16% Change: After closing the last trading session at $236.94, BAIDU opened today at $240.10 and has reached a high of $258.73.

Trade approach: A movement as big as 8.16% is a significantly bullish indicator, so this trade is designed to be profitable if BIDU maintains its current direction and does not revert back to pricing on the bearish side of $256.27 on 19-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 BAIDU closes at or above $254.35 on 19-Feb-2021. Based on our risk-neutral analysis, there is a 51.30% 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.