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Quantchabot has detected a promising Bear Call Spread trade opportunity for ROKU INC. CLASS A COMMON STOCK (ROKU) for the 15-Jul-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
ROKU was recently trading at $80.42 and has an implied volatility of 96.66% for this period. Based on an analysis of the options available for ROKU expiring on 15-Jul-2022, there is a 34.17% likelihood that the underlying will close within the analyzed range of $53.25-$80.50 at expiration. In this scenario, the average linear return for the trade would be 14.34%.
Big -8.37% Change: After closing the last trading session at $87.77, ROKU INC. CLASS A COMMON STOCK opened today at $90.55 and has reached a low of $78.09.
Trade approach: A movement as big as -8.37% is a significantly bearish indicator, so this trade is designed to be profitable if ROKU maintains its current direction and does not revert back to pricing on the bullish side of $80.42 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 ROKU INC. CLASS A COMMON STOCK closes at or below $80.57 on 15-Jul-2022. Based on our risk-neutral analysis, there is a 50.09% 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.