Quantchabot has detected a promising Bull Call Spread trade opportunity for AMBARELLA INC (AMBA) for the 25-Nov-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
AMBA was recently trading at $75.72 and has an implied volatility of 55.63% for this period. Based on an analysis of the options available for AMBA expiring on 25-Nov-2022, there is a 34.46% likelihood that the underlying will close within the analyzed range of $75.78-$82.18 at expiration. In this scenario, the average linear return for the trade would be 10.38%.
Big 13.29% Change: After closing the last trading session at $66.84, AMBARELLA INC opened today at $70.24 and has reached a high of $76.23.
Trade approach: A movement as big as 13.29% is a significantly bullish indicator, so this trade is designed to be profitable if AMBA maintains its current direction and does not revert back to pricing on the bearish side of $75.72 on 25-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 AMBARELLA INC closes at or above $75.50 on 25-Nov-2022. Based on our risk-neutral analysis, there is a 51.87% 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.