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Quantchabot has detected a promising Bear Call Spread trade opportunity for SNOWFLAKE INC (SNOW) for the 25-Feb-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
SNOW was recently trading at $275.02 and has an implied volatility of 61.85% for this period. Based on an analysis of the options available for SNOW expiring on 25-Feb-2022, there is a 34.14% likelihood that the underlying will close within the analyzed range of $220.65-$275.04 at expiration. In this scenario, the average linear return for the trade would be 65.15%.
Big -8.23% Change: After closing the last trading session at $299.68, SNOWFLAKE INC opened today at $290.00 and has reached a low of $274.00.
Trade approach: A movement as big as -8.23% is a significantly bearish indicator, so this trade is designed to be profitable if SNOW maintains its current direction and does not revert back to pricing on the bullish side of $275.02 on 25-Feb-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 SNOWFLAKE INC closes at or below $275.10 on 25-Feb-2022. Based on our risk-neutral analysis, there is a 50.04% 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.