Quantchabot has detected a promising Bear Call Spread trade opportunity for BANK OF NOVA (BNS) for the 19-Aug-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
BNS was recently trading at $58.83 and has an implied volatility of 25.93% for this period. Based on an analysis of the options available for BNS expiring on 19-Aug-2022, there is a 34.17% likelihood that the underlying will close within the analyzed range of $52.43-$58.12 at expiration. In this scenario, the average linear return for the trade would be 40.24%.
52 week low: BANK OF NOVA recently reached a new 52-week low at $58.80. BNS had traded in the range $59.05-$74.86 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 BNS maintains its current direction and does not revert back to pricing on the bullish side of $58.83 on 19-Aug-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 BANK OF NOVA closes at or below $58.20 on 19-Aug-2022. Based on our risk-neutral analysis, there is a 50.53% 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.