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Quantchabot has detected a promising Bear Call Spread trade opportunity for SAP AE (SAP) for the 17-Jun-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
SAP was recently trading at $95.50 and has an implied volatility of 36.45% for this period. Based on an analysis of the options available for SAP expiring on 17-Jun-2022, there is a 34.19% likelihood that the underlying will close within the analyzed range of $83.02-$93.62 at expiration. In this scenario, the average linear return for the trade would be 31.41%.
52 week low: SAP AE recently reached a new 52-week low at $94.79. SAP had traded in the range $98.58-$151.48 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 SAP maintains its current direction and does not revert back to pricing on the bullish side of $95.50 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 SAP AE closes at or below $93.75 on 17-Jun-2022. Based on our risk-neutral analysis, there is a 50.46% 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.