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Quantchabot has detected a promising Bull Put Spread trade opportunity for GENERAL DYNAMICS (GD) for the 23-Apr-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
GD was recently trading at $184.46 and has an implied volatility of 24.43% for this period. Based on an analysis of the options available for GD expiring on 23-Apr-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $183.28-$193.57 at expiration. In this scenario, the average linear return for the trade would be 46.37%.
52 week high: GENERAL DYNAMICS recently reached a new 52-week high at $184.98. GD had traded in the range $121.67-$184.37 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 GD maintains its current direction and does not revert back to pricing on the bearish side of $184.46 on 23-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 bullish strategy, the trade would be profitable if GENERAL DYNAMICS closes at or above $182.50 on 23-Apr-2021. Based on our risk-neutral analysis, there is a 53.11% 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.