Big Loser Alert: Trading today’s -8.7% move in MICROSTRATEGY $MSTR

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Quantchabot has detected a promising Covered Put trade opportunity for MICROSTRATEGY (MSTR) for the 16-Jul-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

MSTR was recently trading at $475.92 and has an implied volatility of 95.67% for this period. Based on an analysis of the options available for MSTR expiring on 16-Jul-2021, there is a 34.13% likelihood that the underlying will close within the analyzed range of $322.65-$476.00 at expiration. In this scenario, the average linear return for the trade would be 181.95%.

Big -8.71% Change: After closing the last trading session at $521.31, MICROSTRATEGY opened today at $484.00 and has reached a low of $470.18.

Trade approach: A movement as big as -8.71% is a significantly bearish indicator, so this trade is designed to be profitable if MSTR maintains its current direction and does not revert back to pricing on the bullish side of $475.92 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 bearish strategy, the trade would be profitable if MICROSTRATEGY closes at or below $705.41 on 16-Jul-2021. Based on our risk-neutral analysis, there is a 84.42% 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.