Quantchabot has detected a promising Bear Call Spread trade opportunity for RESMED (RMD) for the 20-Oct-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
RMD was recently trading at $154.39 and has an implied volatility of 25.56% for this period. Based on an analysis of the options available for RMD expiring on 20-Oct-2023, there is a 34.18% likelihood that the underlying will close within the analyzed range of $142.05-$155.49 at expiration. In this scenario, the average linear return for the trade would be 17.77%.
52 week low: RESMED recently reached a new 52-week low at $152.26. RMD had traded in the range $157.73-$243.52 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 RMD maintains its current direction and does not revert back to pricing on the bullish side of $154.39 on 20-Oct-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 RESMED closes at or below $155.60 on 20-Oct-2023. Based on our risk-neutral analysis, there is a 50.33% 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.