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Quantchabot has detected a promising Bear Put Spread trade opportunity for ALUMINUM CORPORATION (ACH) for the 17-Sep-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
ACH was recently trading at $21.52 and has an implied volatility of 79.06% for this period. Based on an analysis of the options available for ACH expiring on 17-Sep-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $19.94-$21.52 at expiration. In this scenario, the average linear return for the trade would be 23.68%.
Big -7.48% Change: After closing the last trading session at $23.26, ALUMINUM CORPORATION opened today at $21.85 and has reached a low of $21.50.
Trade approach: A movement as big as -7.48% is a significantly bearish indicator, so this trade is designed to be profitable if ACH maintains its current direction and does not revert back to pricing on the bullish side of $21.52 on 17-Sep-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 ALUMINUM CORPORATION closes at or below $21.65 on 17-Sep-2021. Based on our risk-neutral analysis, there is a 53.14% 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.