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Quantchabot has detected a promising Bear Call Spread trade opportunity for APPLOVIN CORPORATION CLASS A COMMON STOC (APP) for the 15-Oct-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
APP was recently trading at $71.44 and has an implied volatility of 67.04% for this period. Based on an analysis of the options available for APP expiring on 15-Oct-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $58.52-$71.45 at expiration. In this scenario, the average linear return for the trade would be 53.34%.
Big -7.68% Change: After closing the last trading session at $77.38, APPLOVIN CORPORATION CLASS A COMMON STOC opened today at $77.56 and has reached a low of $71.42.
Trade approach: A movement as big as -7.68% is a significantly bearish indicator, so this trade is designed to be profitable if APP maintains its current direction and does not revert back to pricing on the bullish side of $71.44 on 15-Oct-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 APPLOVIN CORPORATION CLASS A COMMON STOC closes at or below $71.80 on 15-Oct-2021. Based on our risk-neutral analysis, there is a 50.99% 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.