52-Week High Alert: Trading today’s movement in CVS HEALTH CORP $CVS

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Quantchabot has detected a promising Bull Put Spread trade opportunity for CVS HEALTH CORP (CVS) for the 4-Feb-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

CVS was recently trading at $105.48 and has an implied volatility of 22.43% for this period. Based on an analysis of the options available for CVS expiring on 4-Feb-2022, there is a 34.14% likelihood that the underlying will close within the analyzed range of $104.93-$111.19 at expiration. In this scenario, the average linear return for the trade would be 50.94%.

52 week high: CVS HEALTH CORP recently reached a new 52-week high at $107.26. CVS had traded in the range $68.02-$106.50 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 CVS maintains its current direction and does not revert back to pricing on the bearish side of $105.48 on 4-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 bullish strategy, the trade would be profitable if CVS HEALTH CORP closes at or above $104.70 on 4-Feb-2022. Based on our risk-neutral analysis, there is a 51.53% 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.