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Quantchabot has detected a promising Long Risk Reversal trade opportunity for PETROCHINA (PTR) for the 16-Apr-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
PTR was recently trading at $36.72 and has an implied volatility of 39.97% for this period. Based on an analysis of the options available for PTR expiring on 16-Apr-2021, there is a 34.13% likelihood that the underlying will close within the analyzed range of $36.72-$42.78 at expiration. In this scenario, the average linear return for the trade would be 11.33%.
Big 7.35% Change: After closing the last trading session at $34.20, PETROCHINA opened today at $35.80 and has reached a high of $36.84.
Trade approach: A movement as big as 7.35% is a significantly bullish indicator, so this trade is designed to be profitable if PTR maintains its current direction and does not revert back to pricing on the bearish side of $36.72 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 PETROCHINA closes at or above $34.30 on 16-Apr-2021. Based on our risk-neutral analysis, there is a 67.24% 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.