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Quantchabot has detected a promising Bear Call Spread trade opportunity for ON HOLDING AG (ONON) for the 20-May-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
ONON was recently trading at $24.26 and has an implied volatility of 89.57% for this period. Based on an analysis of the options available for ONON expiring on 20-May-2022, there is a 34.26% likelihood that the underlying will close within the analyzed range of $20.04-$24.27 at expiration. In this scenario, the average linear return for the trade would be 26.74%.
Big -7.72% Change: After closing the last trading session at $26.29, ON HOLDING AG opened today at $26.32 and has reached a low of $24.21.
Trade approach: A movement as big as -7.72% is a significantly bearish indicator, so this trade is designed to be profitable if ONON maintains its current direction and does not revert back to pricing on the bullish side of $24.26 on 20-May-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 ON HOLDING AG closes at or below $24.40 on 20-May-2022. Based on our risk-neutral analysis, there is a 51.16% 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.