Quantchabot has detected a promising Short Risk Reversal trade opportunity for SAP AE (SAP) for the 17-Jan-2025 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
SAP was recently trading at $109.81 and has an implied volatility of 28.93% for this period. Based on an analysis of the options available for SAP expiring on 17-Jan-2025, there is a 24.42% likelihood that the underlying will close within the analyzed range of $79.78-$109.84 at expiration. In this scenario, the average linear return for the trade would be 64.34%.
Trending on StockTwits: StockTwits® is a financial communications platform for the financial and investing community. On their site, SAP AE was recently trending, indicating that breaking news and/or market activity has significantly impacted sentiment toward the stock. This movement can be interpretted as a sign of more near-term price movement for the underlying.
Trade approach: The recent sentiment change in SAP on StockTwits appears to be significantly negative, indicating that the stock is likely to follow in that direction for investors trading on sentiment. As a result, a bearish strategy could prove effective if the sentiment ultimately turns out to drive trading.
Upside potential: Using this bearish strategy, the trade would be profitable if SAP AE closed at or below $115.60 on 17-Jan-2025. Based on our analysis, there is a 45.01% 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.