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Quantchabot has detected a promising Covered Put trade opportunity for PLUG POWER (PLUG) for the 26-Feb-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
PLUG was recently trading at $64.49 and has an implied volatility of 145.70% for this period. Based on an analysis of the options available for PLUG expiring on 26-Feb-2021, there is a 34.13% likelihood that the underlying will close within the analyzed range of $39.06-$64.50 at expiration. In this scenario, the average linear return for the trade would be 153.88%.
Big -7.21% Change: After closing the last trading session at $69.50, PLUG POWER opened today at $66.22 and has reached a low of $63.76.
Trade approach: A movement as big as -7.21% is a significantly bearish indicator, so this trade is designed to be profitable if PLUG maintains its current direction and does not revert back to pricing on the bullish side of $64.49 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 bearish strategy, the trade would be profitable if PLUG POWER closes at or below $94.08 on 26-Feb-2021. Based on our risk-neutral analysis, there is a 77.43% 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.