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Quantchabot has detected a promising Bull Put Spread trade opportunity for REGIONS FINANCIAL (RF) for the 19-Mar-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
RF was recently trading at $21.10 and has an implied volatility of 38.49% for this period. Based on an analysis of the options available for RF expiring on 19-Mar-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $20.94-$23.13 at expiration. In this scenario, the average linear return for the trade would be 42.67%.
52 week high: REGIONS FINANCIAL recently reached a new 52-week high at $21.27. RF had traded in the range $6.94-$20.47 over the past year.
Trade approach: Reaching a new 52-week high is a bullish indicator, so this trade is designed to be profitable if RF maintains its current direction and does not revert back to pricing on the bearish side of $21.10 on 19-Mar-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 REGIONS FINANCIAL closes at or above $20.70 on 19-Mar-2021. Based on our risk-neutral analysis, there is a 54.66% 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.