Quantchabot has detected a promising Bear Call Spread trade opportunity for U.S. BANCORP (USB) for the 14-Apr-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
USB was recently trading at $37.48 and has an implied volatility of 56.88% for this period. Based on an analysis of the options available for USB expiring on 14-Apr-2023, there is a 34.20% likelihood that the underlying will close within the analyzed range of $31.75-$37.65 at expiration. In this scenario, the average linear return for the trade would be 46.30%.
Big -7.73% Change: After closing the last trading session at $40.62, U.S. BANCORP opened today at $38.05 and has reached a low of $36.73.
Trade approach: A movement as big as -7.73% is a significantly bearish indicator, so this trade is designed to be profitable if USB maintains its current direction and does not revert back to pricing on the bullish side of $37.48 on 14-Apr-2023. 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 U.S. BANCORP closes at or below $37.65 on 14-Apr-2023. Based on our risk-neutral analysis, there is a 50.03% 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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