Quantcha now offering unlimited commission-free options trading.
Quantchabot has detected a promising Bull Call Spread trade opportunity for CVS HEALTH CORP (CVS) for the 2-Jul-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
CVS was recently trading at $87.24 and has an implied volatility of 22.98% for this period. Based on an analysis of the options available for CVS expiring on 2-Jul-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $87.25-$94.62 at expiration. In this scenario, the average linear return for the trade would be 51.61%.
52 week high: CVS HEALTH CORP recently reached a new 52-week high at $87.45. CVS had traded in the range $55.36-$87.18 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 CVS maintains its current direction and does not revert back to pricing on the bearish side of $87.24 on 2-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 CVS HEALTH CORP closes at or above $87.22 on 2-Jul-2021. Based on our risk-neutral analysis, there is a 50.17% 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.