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Quantchabot has detected a promising Bull Put Spread trade opportunity for GSX TECHEDU INC (GOTU) for the 21-May-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
GOTU was recently trading at $25.69 and has an implied volatility of 103.24% for this period. Based on an analysis of the options available for GOTU expiring on 21-May-2021, there is a 34.17% likelihood that the underlying will close within the analyzed range of $25.69-$27.38 at expiration. In this scenario, the average linear return for the trade would be 35.04%.
Big 8.99% Change: After closing the last trading session at $23.57, GSX TECHEDU INC opened today at $23.97 and has reached a high of $25.70.
Trade approach: A movement as big as 8.99% is a significantly bullish indicator, so this trade is designed to be profitable if GOTU maintains its current direction and does not revert back to pricing on the bearish side of $25.69 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 GSX TECHEDU INC closes at or above $25.68 on 21-May-2021. Based on our risk-neutral analysis, there is a 50.25% 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.