Quantchabot has detected a promising Bear Call Spread trade opportunity for DEERE (DE) for the 5-Aug-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
DE was recently trading at $304.98 and has an implied volatility of 38.67% for this period. Based on an analysis of the options available for DE expiring on 5-Aug-2022, there is a 34.18% likelihood that the underlying will close within the analyzed range of $266.10-$304.21 at expiration. In this scenario, the average linear return for the trade would be 44.33%.
52 week low: DEERE recently reached a new 52-week low at $303.66. DE had traded in the range $307.64-$446.76 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 DE maintains its current direction and does not revert back to pricing on the bullish side of $304.98 on 5-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 DEERE closes at or below $304.80 on 5-Aug-2022. Based on our risk-neutral analysis, there is a 50.58% 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.