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Quantchabot has detected a promising Bull Call Spread trade opportunity for ROSS STORES (ROST) for the 21-May-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
ROST was recently trading at $127.00 and has an implied volatility of 32.46% for this period. Based on an analysis of the options available for ROST expiring on 21-May-2021, there is a 34.13% likelihood that the underlying will close within the analyzed range of $127.02-$142.03 at expiration. In this scenario, the average linear return for the trade would be 63.06%.
52 week high: ROSS STORES recently reached a new 52-week high at $127.52. ROST had traded in the range $79.65-$127.08 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 ROST maintains its current direction and does not revert back to pricing on the bearish side of $127.00 on 21-May-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 ROSS STORES closes at or above $125.90 on 21-May-2021. Based on our risk-neutral analysis, there is a 53.15% 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.