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Quantchabot has detected a promising Bear Put Spread trade opportunity for FREEPORT-MCMORAN INC (FCX) for the 16-Jul-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
FCX was recently trading at $39.99 and has an implied volatility of 53.90% for this period. Based on an analysis of the options available for FCX expiring on 16-Jul-2021, there is a 34.13% likelihood that the underlying will close within the analyzed range of $32.24-$39.99 at expiration. In this scenario, the average linear return for the trade would be 60.88%.
Big -8.35% Change: After closing the last trading session at $43.63, FREEPORT-MCMORAN INC opened today at $41.24 and has reached a low of $39.89.
Trade approach: A movement as big as -8.35% is a significantly bearish indicator, so this trade is designed to be profitable if FCX maintains its current direction and does not revert back to pricing on the bullish side of $39.99 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 FREEPORT-MCMORAN INC closes at or below $40.18 on 16-Jul-2021. Based on our risk-neutral analysis, there is a 50.86% 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.