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Quantchabot has detected a promising Bear Call Spread trade opportunity for TEVA PHARMACEUTICAL (TEVA) for the 17-Jun-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
TEVA was recently trading at $7.97 and has an implied volatility of 47.29% for this period. Based on an analysis of the options available for TEVA expiring on 17-Jun-2022, there is a 34.18% likelihood that the underlying will close within the analyzed range of $6.76-$7.98 at expiration. In this scenario, the average linear return for the trade would be 31.09%.
Big -7.27% Change: After closing the last trading session at $8.60, TEVA PHARMACEUTICAL opened today at $8.41 and has reached a low of $7.88.
Trade approach: A movement as big as -7.27% is a significantly bearish indicator, so this trade is designed to be profitable if TEVA maintains its current direction and does not revert back to pricing on the bullish side of $7.97 on 17-Jun-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 TEVA PHARMACEUTICAL closes at or below $8.03 on 17-Jun-2022. Based on our risk-neutral analysis, there is a 51.52% 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.