Quantchabot has detected a promising Bear Call Spread trade opportunity for LOWE’S COMPANIES (LOW) for the 29-Jul-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

LOW was recently trading at $171.31 and has an implied volatility of 36.40% for this period. Based on an analysis of the options available for LOW expiring on 29-Jul-2022, there is a 34.19% likelihood that the underlying will close within the analyzed range of $151.63-$170.46 at expiration. In this scenario, the average linear return for the trade would be 30.68%.

52 week low: LOWE’S COMPANIES recently reached a new 52-week low at $170.12. LOW had traded in the range $170.14-$263.31 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 LOW maintains its current direction and does not revert back to pricing on the bullish side of $171.31 on 29-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 LOWE’S COMPANIES closes at or below $170.57 on 29-Jul-2022. Based on our risk-neutral analysis, there is a 50.23% 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.