Big Loser Alert: Trading today’s -10.5% move in GAMESTOP $GME

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Quantchabot has detected a promising Covered Put trade opportunity for GAMESTOP (GME) for the 18-Mar-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

GME was recently trading at $125.84 and has an implied volatility of 109.09% for this period. Based on an analysis of the options available for GME expiring on 18-Mar-2022, there is a 34.14% likelihood that the underlying will close within the analyzed range of $78.80-$125.86 at expiration. In this scenario, the average linear return for the trade would be 252.34%.

Big -10.51% Change: After closing the last trading session at $140.62, GAMESTOP opened today at $134.99 and has reached a low of $120.00.

Trade approach: A movement as big as -10.51% is a significantly bearish indicator, so this trade is designed to be profitable if GME maintains its current direction and does not revert back to pricing on the bullish side of $125.84 on 18-Mar-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 GAMESTOP closes at or below $184.86 on 18-Mar-2022. Based on our risk-neutral analysis, there is a 79.42% 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.