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Quantchabot has detected a promising Bull Call Spread trade opportunity for CLEVELAND-CLIFFS INC (CLF) for the 16-Jul-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
CLF was recently trading at $20.88 and has an implied volatility of 70.19% for this period. Based on an analysis of the options available for CLF expiring on 16-Jul-2021, there is a 34.13% likelihood that the underlying will close within the analyzed range of $20.88-$27.78 at expiration. In this scenario, the average linear return for the trade would be 96.09%.
Big 7.02% Change: After closing the last trading session at $19.51, CLEVELAND-CLIFFS INC opened today at $19.90 and has reached a high of $20.97.
Trade approach: A movement as big as 7.02% is a significantly bullish indicator, so this trade is designed to be profitable if CLF maintains its current direction and does not revert back to pricing on the bearish side of $20.88 on 16-Jul-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 CLEVELAND-CLIFFS INC closes at or above $20.82 on 16-Jul-2021. Based on our risk-neutral analysis, there is a 50.42% 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.