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Quantchabot has detected a promising Short Risk Reversal trade opportunity for SOLAREDGE TECHNOLOGIES INC. C (SEDG) for the 16-Apr-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
SEDG was recently trading at $296.61 and has an implied volatility of 66.76% for this period. Based on an analysis of the options available for SEDG expiring on 16-Apr-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $229.90-$296.65 at expiration. In this scenario, the average linear return for the trade would be 60.97%.
Big -7.88% Change: After closing the last trading session at $321.99, SOLAREDGE TECHNOLOGIES INC. C opened today at $310.76 and has reached a low of $296.00.
Trade approach: A movement as big as -7.88% is a significantly bearish indicator, so this trade is designed to be profitable if SEDG maintains its current direction and does not revert back to pricing on the bullish side of $296.61 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 SOLAREDGE TECHNOLOGIES INC. C closes at or below $308.00 on 16-Apr-2021. Based on our risk-neutral analysis, there is a 55.85% 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.