Quantchabot has detected a promising Covered Call trade opportunity for PETCO HEALTH AND WELLNESS COMPANY INC. CLASS A (WOOF) for the 19-May-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
WOOF was recently trading at $10.52 and has an implied volatility of 94.29% for this period. Based on an analysis of the options available for WOOF expiring on 19-May-2023, there is a 34.17% likelihood that the underlying will close within the analyzed range of $10.60-$15.76 at expiration. In this scenario, the average linear return for the trade would be 12.61%.
Big 7.30% Change: After closing the last trading session at $9.80, PETCO HEALTH AND WELLNESS COMPANY INC. CLASS A opened today at $9.77 and has reached a high of $10.53.
Trade approach: A movement as big as 7.30% is a significantly bullish indicator, so this trade is designed to be profitable if WOOF maintains its current direction and does not revert back to pricing on the bearish side of $10.52 on 19-May-2023. 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 PETCO HEALTH AND WELLNESS COMPANY INC. CLASS A closes at or above $10.42 on 19-May-2023. Based on our risk-neutral analysis, there is a 51.68% 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.
Leave a Reply
You must be logged in to post a comment.