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Quantchabot has detected a promising Long Risk Reversal trade opportunity for SIERRA WIRELESS (SWIR) for the 18-Feb-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
SWIR was recently trading at $16.70 and has an implied volatility of 45.93% for this period. Based on an analysis of the options available for SWIR expiring on 18-Feb-2022, there is a 35.07% likelihood that the underlying will close within the analyzed range of $16.64-$19.27 at expiration. In this scenario, the average linear return for the trade would be 20.47%.
Trending on StockTwits: StockTwits® is a financial communications platform for the financial and investing community. On their site, SIERRA WIRELESS was recently trending, indicating that breaking news and/or market activity has significantly impacted sentiment toward the stock. This movement can be interpretted as a sign of more near-term price movement for the underlying.
Trade approach: The recent sentiment change in SWIR on StockTwits appears to be moderately positive, indicating that the stock is likely to follow in that direction for investors trading on sentiment. As a result, a bullish strategy could prove effective if the sentiment ultimately turns out to drive trading.
Upside potential: Using this bullish strategy, the trade would be profitable if SIERRA WIRELESS closed at or above $16.60 on 18-Feb-2022. Based on our analysis, there is a 51.69% 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.