Quantcha now offering unlimited commission-free options trading.
Quantchabot has detected a promising Bull Put Spread trade opportunity for WARNER MUSIC GROUP CORP. CLASS A COMMON STOCK (WMG) for the 19-Nov-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
WMG was recently trading at $39.36 and has an implied volatility of 30.98% for this period. Based on an analysis of the options available for WMG expiring on 19-Nov-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $39.37-$45.10 at expiration. In this scenario, the average linear return for the trade would be 51.85%.
52 week high: WARNER MUSIC GROUP CORP. CLASS A COMMON STOCK recently reached a new 52-week high at $40.34. WMG had traded in the range $25.61-$39.61 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 WMG maintains its current direction and does not revert back to pricing on the bearish side of $39.36 on 19-Nov-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 WARNER MUSIC GROUP CORP. CLASS A COMMON STOCK closes at or above $39.10 on 19-Nov-2021. Based on our risk-neutral analysis, there is a 51.99% 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.