Quantcha now offering unlimited commission-free options trading.
Quantchabot has detected a promising Bull Put Spread trade opportunity for DOW INC (DOW) for the 16-Apr-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
DOW was recently trading at $61.73 and has an implied volatility of 35.29% for this period. Based on an analysis of the options available for DOW expiring on 16-Apr-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $61.04-$69.85 at expiration. In this scenario, the average linear return for the trade would be 56.21%.
52 week high: DOW INC recently reached a new 52-week high at $62.28. DOW had traded in the range $21.95-$61.31 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 DOW maintains its current direction and does not revert back to pricing on the bearish side of $61.73 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 DOW INC closes at or above $60.60 on 16-Apr-2021. Based on our risk-neutral analysis, there is a 52.14% 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.