52-Week Low Alert: Trading today’s movement in TAIWAN SEMICONDUCTOR $TSM

Quantchabot has detected a promising Bear Call Spread trade opportunity for TAIWAN SEMICONDUCTOR (TSM) for the 8-Jul-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

TSM was recently trading at $83.47 and has an implied volatility of 33.08% for this period. Based on an analysis of the options available for TSM expiring on 8-Jul-2022, there is a 34.27% likelihood that the underlying will close within the analyzed range of $77.96-$83.51 at expiration. In this scenario, the average linear return for the trade would be 34.61%.

52 week low: TAIWAN SEMICONDUCTOR recently reached a new 52-week low at $82.75. TSM had traded in the range $83.95-$145.00 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 TSM maintains its current direction and does not revert back to pricing on the bullish side of $83.47 on 8-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 TAIWAN SEMICONDUCTOR closes at or below $83.52 on 8-Jul-2022. Based on our risk-neutral analysis, there is a 50.10% 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.

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