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Quantchabot has detected a promising Bear Call Spread trade opportunity for CERENCE INC (CRNC) for the 21-Jan-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
CRNC was recently trading at $69.97 and has an implied volatility of 58.02% for this period. Based on an analysis of the options available for CRNC expiring on 21-Jan-2022, there is a 34.14% likelihood that the underlying will close within the analyzed range of $64.45-$69.97 at expiration. In this scenario, the average linear return for the trade would be 13.64%.
Big -7.26% Change: After closing the last trading session at $75.45, CERENCE INC opened today at $70.97 and has reached a low of $69.51.
Trade approach: A movement as big as -7.26% is a significantly bearish indicator, so this trade is designed to be profitable if CRNC maintains its current direction and does not revert back to pricing on the bullish side of $69.97 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 bearish strategy, the trade would be profitable if CERENCE INC closes at or below $71.20 on 21-Jan-2022. Based on our risk-neutral analysis, there is a 58.40% 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.