Quantchabot has detected a promising Bull Call Spread trade opportunity for LI AUTO INC (LI) for the 18-Nov-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
LI was recently trading at $25.10 and has an implied volatility of 67.35% for this period. Based on an analysis of the options available for LI expiring on 18-Nov-2022, there is a 34.17% likelihood that the underlying will close within the analyzed range of $25.20-$32.95 at expiration. In this scenario, the average linear return for the trade would be 11.11%.
Big 8.66% Change: After closing the last trading session at $23.10, LI AUTO INC opened today at $24.41 and has reached a high of $25.40.
Trade approach: A movement as big as 8.66% is a significantly bullish indicator, so this trade is designed to be profitable if LI maintains its current direction and does not revert back to pricing on the bearish side of $25.10 on 18-Nov-2022. If possible, the trade has been padded such that slight movement against the trade would still return a profit.
Upside potential: Using this bullish strategy, the trade would be profitable if LI AUTO INC closes at or above $20.40 on 18-Nov-2022. Based on our risk-neutral analysis, there is a 78.54% 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.