Big Loser Alert: Trading today’s -8.3% move in REE AUTOMOTIVE LTD. CLASS A ORDINARY SHARES $REE

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Quantchabot has detected a promising Covered Put trade opportunity for REE AUTOMOTIVE LTD. CLASS A ORDINARY SHARES (REE) for the 21-Jan-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

REE was recently trading at $4.87 and has an implied volatility of 131.97% for this period. Based on an analysis of the options available for REE expiring on 21-Jan-2022, there is a 34.14% likelihood that the underlying will close within the analyzed range of $4.04-$4.87 at expiration. In this scenario, the average linear return for the trade would be 12.71%.

Big -8.29% Change: After closing the last trading session at $5.31, REE AUTOMOTIVE LTD. CLASS A ORDINARY SHARES opened today at $5.20 and has reached a low of $4.81.

Trade approach: A movement as big as -8.29% is a significantly bearish indicator, so this trade is designed to be profitable if REE maintains its current direction and does not revert back to pricing on the bullish side of $4.87 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 REE AUTOMOTIVE LTD. CLASS A ORDINARY SHARES closes at or below $5.26 on 21-Jan-2022. Based on our risk-neutral analysis, there is a 65.96% 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.