Quantchabot has detected a promising Bull Call Spread trade opportunity for PACWEST BANCORP (PACW) for the 23-Jun-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
PACW was recently trading at $6.76 and has an implied volatility of 278.96% for this period. Based on an analysis of the options available for PACW expiring on 23-Jun-2023, there is a 34.18% likelihood that the underlying will close within the analyzed range of $6.81-$18.48 at expiration. In this scenario, the average linear return for the trade would be 11.11%.
Big 17.36% Change: After closing the last trading session at $5.76, PACWEST BANCORP opened today at $7.48 and has reached a high of $7.50.
Trade approach: A movement as big as 17.36% is a significantly bullish indicator, so this trade is designed to be profitable if PACW maintains its current direction and does not revert back to pricing on the bearish side of $6.76 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 bullish strategy, the trade would be profitable if PACWEST BANCORP closes at or above $5.20 on 23-Jun-2023. Based on our risk-neutral analysis, there is a 60.67% 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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