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Quantchabot has detected a promising Bear Call Spread trade opportunity for EDITAS MEDICINE INC. COMMON STOCK (EDIT) for the 29-Oct-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
EDIT was recently trading at $35.74 and has an implied volatility of 66.15% for this period. Based on an analysis of the options available for EDIT expiring on 29-Oct-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $30.45-$35.74 at expiration. In this scenario, the average linear return for the trade would be 40.65%.
Big -8.43% Change: After closing the last trading session at $39.03, EDITAS MEDICINE INC. COMMON STOCK opened today at $38.63 and has reached a low of $35.25.
Trade approach: A movement as big as -8.43% is a significantly bearish indicator, so this trade is designed to be profitable if EDIT maintains its current direction and does not revert back to pricing on the bullish side of $35.74 on 29-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 EDITAS MEDICINE INC. COMMON STOCK closes at or below $35.95 on 29-Oct-2021. Based on our risk-neutral analysis, there is a 51.45% 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.