Big Loser Alert: Trading today’s -7.9% move in DOMA HOLDINGS INC $DOMA

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Quantchabot has detected a promising Covered Put trade opportunity for DOMA HOLDINGS INC (DOMA) for the 21-Jan-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

DOMA was recently trading at $6.19 and has an implied volatility of 95.54% for this period. Based on an analysis of the options available for DOMA expiring on 21-Jan-2022, there is a 34.14% likelihood that the underlying will close within the analyzed range of $4.21-$6.19 at expiration. In this scenario, the average linear return for the trade would be 42.54%.

Big -7.89% Change: After closing the last trading session at $6.72, DOMA HOLDINGS INC opened today at $6.72 and has reached a low of $6.19.

Trade approach: A movement as big as -7.89% is a significantly bearish indicator, so this trade is designed to be profitable if DOMA maintains its current direction and does not revert back to pricing on the bullish side of $6.19 on 21-Jan-2022. 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 DOMA HOLDINGS INC closes at or below $6.53 on 21-Jan-2022. Based on our risk-neutral analysis, there is a 55.51% 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.