Quantcha now offering unlimited commission-free options trading.
Quantchabot has detected a promising Long Risk Reversal trade opportunity for DESKTOP METAL INC (DM) for the 19-Nov-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
DM was recently trading at $7.14 and has an implied volatility of 69.92% for this period. Based on an analysis of the options available for DM expiring on 19-Nov-2021, there is a 34.15% likelihood that the underlying will close within the analyzed range of $7.14-$8.91 at expiration. In this scenario, the average linear return for the trade would be 42.61%.
Trending on StockTwits: StockTwits® is a financial communications platform for the financial and investing community. On their site, DESKTOP METAL INC was recently trending, indicating that breaking news and/or market activity has significantly impacted sentiment toward the stock. This movement can be interpretted as a sign of more near-term price movement for the underlying.
Trade approach: The recent sentiment change in DM on StockTwits appears to be moderately positive, indicating that the stock is likely to follow in that direction for investors trading on sentiment. As a result, a bullish strategy could prove effective if the sentiment ultimately turns out to drive trading.
Upside potential: Using this bullish strategy, the trade would be profitable if DESKTOP METAL INC closed at or above $6.80 on 19-Nov-2021. Based on our analysis, there is a 58.76% 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.