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Quantchabot has detected a promising Bear Call Spread trade opportunity for VERIZON COMMUNICATIONS (VZ) for the 15-Jul-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
VZ was recently trading at $46.70 and has an implied volatility of 25.09% for this period. Based on an analysis of the options available for VZ expiring on 15-Jul-2022, there is a 34.16% likelihood that the underlying will close within the analyzed range of $41.72-$46.73 at expiration. In this scenario, the average linear return for the trade would be 17.78%.
52 week low: VERIZON COMMUNICATIONS recently reached a new 52-week low at $46.34. VZ had traded in the range $48.30-$59.85 over the past year.
Trade approach: Reaching a new 52-week low is a bearish indicator, so this trade is designed to be profitable if VZ maintains its current direction and does not revert back to pricing on the bullish side of $46.70 on 15-Jul-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 VERIZON COMMUNICATIONS closes at or below $46.74 on 15-Jul-2022. Based on our risk-neutral analysis, there is a 50.07% 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.