Quantchabot has detected a promising Synthetic Long Stock trade opportunity for FREEDOM HOLDING CORP. COMMON STOCK (FRHC) for the 15-Mar-2024 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
FRHC was recently trading at $95.78 and has an implied volatility of 93.96% for this period. Based on an analysis of the options available for FRHC expiring on 15-Mar-2024, there is a 68.29% likelihood that the underlying will close within the analyzed range of $49.26-$198.46 at expiration. In this scenario, the average linear return for the trade would be 128.99%.
Upside potential: This synthetic long position offers the same potential benefits and liabilities as a long stock position, but at a discount due to the significant premium at-the-money puts are trading at over calls. In this case, the long call position is opened at a strike of $95.00, which is already $0.78 in the money. An out-of-the-money put at the same strike is sold to finance the call, resulting in a net credit of $26.90 per share. The final position can be considered as having a discount of $27.69 per share over the underlying price of $95.78 for a 28.90% total.
Downside risk: This discount is generally a sign of the stock facing considerable short pressure, and may indicate that the stock has become hard to borrow. However, if you have a long view of the underlying over this period, it could be a good opportunity to benefit from the upside at a major discount.
To analyze this trade in depth, please visit the Quantcha Options Search Engine.