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Quantchabot has detected a promising Bull Call Spread trade opportunity for CME GROUP (CME) for the 21-Jan-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
CME was recently trading at $229.28 and has an implied volatility of 23.36% for this period. Based on an analysis of the options available for CME expiring on 21-Jan-2022, there is a 34.13% likelihood that the underlying will close within the analyzed range of $228.41-$250.77 at expiration. In this scenario, the average linear return for the trade would be 41.75%.
52 week high: CME GROUP recently reached a new 52-week high at $230.90. CME had traded in the range $167.72-$230.89 over the past year.
Trade approach: Reaching a new 52-week high is a bullish indicator, so this trade is designed to be profitable if CME maintains its current direction and does not revert back to pricing on the bearish side of $229.28 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 bullish strategy, the trade would be profitable if CME GROUP closes at or above $227.00 on 21-Jan-2022. Based on our risk-neutral analysis, there is a 52.65% 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.