Quantchabot has detected a promising Bear Call Spread trade opportunity for WESTROCK CO (WRK) for the 21-Apr-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
WRK was recently trading at $27.09 and has an implied volatility of 37.35% for this period. Based on an analysis of the options available for WRK expiring on 21-Apr-2023, there is a 34.19% likelihood that the underlying will close within the analyzed range of $24.21-$27.20 at expiration. In this scenario, the average linear return for the trade would be 35.14%.
52 week low: WESTROCK CO recently reached a new 52-week low at $27.04. WRK had traded in the range $27.15-$54.78 over the past year.
Trade approach: Reaching a new 52-week low is a bearish indicator, so this trade is designed to be profitable if WRK maintains its current direction and does not revert back to pricing on the bullish side of $27.09 on 21-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 WESTROCK CO closes at or below $28.15 on 21-Apr-2023. Based on our risk-neutral analysis, there is a 61.54% 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.
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