Synthetic Long Discount Alert: BOXED INC $BOXD trading at a 24.36% discount for the 20-Jan-2023 expiration

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Quantchabot has detected a promising Synthetic Long Stock trade opportunity for BOXED INC (BOXD) for the 20-Jan-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

BOXD was recently trading at $11.37 and has an implied volatility of 75.86% for this period. Based on an analysis of the options available for BOXD expiring on 20-Jan-2023, there is a 68.28% likelihood that the underlying will close within the analyzed range of $6.03-$21.89 at expiration. In this scenario, the average linear return for the trade would be 105.76%.

Upside potential: This synthetic long position offers the same potential benefits and liabilities as a long stock position, but at a discount due to the significant premium at-the-money puts are trading at over calls. In this case, the put position is opened at a strike of $12.50, which is already $1.13 in-the-money. However, its sale more than offsets this moneyness and the cost of the long call that the trade results in a net credit of of $3.90 per share. The final position can be considered as having a discount of $2.77 per share over the underlying price of $11.37 for a 24.36% total.

Downside risk: This discount is generally a sign of the stock facing considerable short pressure, and may indicate that the stock has become hard to borrow. However, if you have a long view of the underlying over this period, it could be a good opportunity to benefit from the upside at a major discount.

To analyze this trade in depth, please visit the Quantcha Options Search Engine.