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Quantchabot has detected a promising Bear Call Spread trade opportunity for PETROLEO BRASILEIRO SA (PBR) for the 26-Feb-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
PBR was recently trading at $7.99 and has an implied volatility of 103.54% for this period. Based on an analysis of the options available for PBR expiring on 26-Feb-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $7.14-$7.99 at expiration. In this scenario, the average linear return for the trade would be 31.58%.
Big -20.50% Change: After closing the last trading session at $10.05, PETROLEO BRASILEIRO SA opened today at $7.88 and has reached a low of $7.86.
Trade approach: A movement as big as -20.50% is a significantly bearish indicator, so this trade is designed to be profitable if PBR maintains its current direction and does not revert back to pricing on the bullish side of $7.99 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 PETROLEO BRASILEIRO SA closes at or below $8.24 on 26-Feb-2021. Based on our risk-neutral analysis, there is a 60.74% 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.