Big Loser Alert: Trading today’s -7.8% move in NOVAVAX $NVAX

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Quantchabot has detected a promising Bear Call Spread trade opportunity for NOVAVAX (NVAX) for the 26-Feb-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

NVAX was recently trading at $256.33 and has an implied volatility of 109.98% for this period. Based on an analysis of the options available for NVAX expiring on 26-Feb-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $227.53-$256.33 at expiration. In this scenario, the average linear return for the trade would be 43.93%.

Big -7.75% Change: After closing the last trading session at $277.88, NOVAVAX opened today at $268.00 and has reached a low of $252.55.

Trade approach: A movement as big as -7.75% is a significantly bearish indicator, so this trade is designed to be profitable if NVAX maintains its current direction and does not revert back to pricing on the bullish side of $256.33 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 NOVAVAX closes at or below $256.45 on 26-Feb-2021. Based on our risk-neutral analysis, there is a 50.15% 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.