Big Loser Alert: Trading today’s -7.7% move in DIREXION DAILY CSI CHINA INTERNET INDEX BULL 2X $CWEB

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Quantchabot has detected a promising Short Risk Reversal trade opportunity for DIREXION DAILY CSI CHINA INTERNET INDEX BULL 2X (CWEB) for the 18-Feb-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

CWEB was recently trading at $12.98 and has an implied volatility of 97.36% for this period. Based on an analysis of the options available for CWEB expiring on 18-Feb-2022, there is a 34.14% likelihood that the underlying will close within the analyzed range of $9.55-$12.98 at expiration. In this scenario, the average linear return for the trade would be 63.18%.

Big -7.75% Change: After closing the last trading session at $14.07, DIREXION DAILY CSI CHINA INTERNET INDEX BULL 2X opened today at $13.55 and has reached a low of $12.64.

Trade approach: A movement as big as -7.75% is a significantly bearish indicator, so this trade is designed to be profitable if CWEB maintains its current direction and does not revert back to pricing on the bullish side of $12.98 on 18-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 DIREXION DAILY CSI CHINA INTERNET INDEX BULL 2X closes at or below $13.35 on 18-Feb-2022. Based on our risk-neutral analysis, there is a 53.64% 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.