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Quantchabot has detected a promising Bull Put Spread trade opportunity for TORONTO-DOMINION BANK (TD) for the 21-May-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
TD was recently trading at $68.08 and has an implied volatility of 13.50% for this period. Based on an analysis of the options available for TD expiring on 21-May-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $68.09-$70.55 at expiration. In this scenario, the average linear return for the trade would be 16.28%.
52 week high: TORONTO-DOMINION BANK recently reached a new 52-week high at $68.29. TD had traded in the range $37.62-$67.23 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 TD maintains its current direction and does not revert back to pricing on the bearish side of $68.08 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 TORONTO-DOMINION BANK closes at or above $67.15 on 21-May-2021. Based on our risk-neutral analysis, there is a 65.11% 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.