Quantchabot has detected a promising Bear Call Spread trade opportunity for FREEPORT-MCMORAN INC (FCX) for the 15-Jul-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
FCX was recently trading at $29.89 and has an implied volatility of 59.62% for this period. Based on an analysis of the options available for FCX expiring on 15-Jul-2022, there is a 34.23% likelihood that the underlying will close within the analyzed range of $25.64-$29.76 at expiration. In this scenario, the average linear return for the trade would be 27.28%.
52 week low: FREEPORT-MCMORAN INC recently reached a new 52-week low at $29.56. FCX had traded in the range $30.02-$51.99 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 FCX maintains its current direction and does not revert back to pricing on the bullish side of $29.89 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 FREEPORT-MCMORAN INC closes at or below $29.77 on 15-Jul-2022. Based on our risk-neutral analysis, there is a 50.11% 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.