Quantchabot has detected a promising Covered Put trade opportunity for DESIGN THERAPEUTICS INC. COMMON STOCK (DSGN) for the 21-Oct-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
DSGN was recently trading at $15.78 and has an implied volatility of 89.14% for this period. Based on an analysis of the options available for DSGN expiring on 21-Oct-2022, there is a 34.20% likelihood that the underlying will close within the analyzed range of $12.21-$15.81 at expiration. In this scenario, the average linear return for the trade would be 12.57%.
Big -16.95% Change: After closing the last trading session at $19.00, DESIGN THERAPEUTICS INC. COMMON STOCK opened today at $17.47 and has reached a low of $15.66.
Trade approach: A movement as big as -16.95% is a significantly bearish indicator, so this trade is designed to be profitable if DSGN maintains its current direction and does not revert back to pricing on the bullish side of $15.78 on 21-Oct-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 DESIGN THERAPEUTICS INC. COMMON STOCK closes at or below $16.05 on 21-Oct-2022. Based on our risk-neutral analysis, there is a 52.29% 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.