Quantchabot has detected a promising Bear Call Spread trade opportunity for DOLLAR TREE STORES (DLTR) for the 17-Nov-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
DLTR was recently trading at $124.55 and has an implied volatility of 24.34% for this period. Based on an analysis of the options available for DLTR expiring on 17-Nov-2023, there is a 34.16% likelihood that the underlying will close within the analyzed range of $112.43-$126.15 at expiration. In this scenario, the average linear return for the trade would be 22.16%.
52 week low: DOLLAR TREE STORES recently reached a new 52-week low at $123.00. DLTR had traded in the range $123.52-$170.36 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 DLTR maintains its current direction and does not revert back to pricing on the bullish side of $124.55 on 17-Nov-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 DOLLAR TREE STORES closes at or below $126.16 on 17-Nov-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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