Quantchabot has detected a promising Bear Call Spread trade opportunity for GENERAL DYNAMICS (GD) for the 23-Jun-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
GD was recently trading at $206.85 and has an implied volatility of 20.28% for this period. Based on an analysis of the options available for GD expiring on 23-Jun-2023, there is a 34.18% likelihood that the underlying will close within the analyzed range of $193.07-$208.24 at expiration. In this scenario, the average linear return for the trade would be 46.74%.
52 week low: GENERAL DYNAMICS recently reached a new 52-week low at $206.57. GD had traded in the range $207.42-$256.86 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 GD maintains its current direction and does not revert back to pricing on the bullish side of $206.85 on 23-Jun-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 GENERAL DYNAMICS closes at or below $208.85 on 23-Jun-2023. Based on our risk-neutral analysis, there is a 51.56% 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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