Big Loser Alert: Trading today’s -7.1% move in BANK BRADESCO $BBD

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Quantchabot has detected a promising Bear Call Spread trade opportunity for BANK BRADESCO (BBD) for the 16-Apr-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

BBD was recently trading at $4.25 and has an implied volatility of 48.27% for this period. Based on an analysis of the options available for BBD expiring on 16-Apr-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $3.54-$4.26 at expiration. In this scenario, the average linear return for the trade would be 37.92%.

Big -7.10% Change: After closing the last trading session at $4.58, BANK BRADESCO opened today at $4.28 and has reached a low of $4.23.

Trade approach: A movement as big as -7.10% is a significantly bearish indicator, so this trade is designed to be profitable if BBD maintains its current direction and does not revert back to pricing on the bullish side of $4.25 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 bearish strategy, the trade would be profitable if BANK BRADESCO closes at or below $4.31 on 16-Apr-2021. Based on our risk-neutral analysis, there is a 52.74% 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.