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Quantchabot has detected a promising Bull Put Spread trade opportunity for CAPITAL ONE FINANCIAL (COF) for the 16-Apr-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
COF was recently trading at $122.65 and has an implied volatility of 40.10% for this period. Based on an analysis of the options available for COF expiring on 16-Apr-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $122.67-$142.98 at expiration. In this scenario, the average linear return for the trade would be 66.43%.
52 week high: CAPITAL ONE FINANCIAL recently reached a new 52-week high at $123.03. COF had traded in the range $38.00-$120.98 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 COF maintains its current direction and does not revert back to pricing on the bearish side of $122.65 on 16-Apr-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 CAPITAL ONE FINANCIAL closes at or above $120.90 on 16-Apr-2021. Based on our risk-neutral analysis, there is a 53.78% 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.