Quantchabot has detected a promising Bear Call Spread trade opportunity for BUILDERS FIRSTSOURCE (BLDR) for the 20-Oct-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
BLDR was recently trading at $137.50 and has an implied volatility of 42.52% for this period. Based on an analysis of the options available for BLDR expiring on 20-Oct-2023, there is a 34.18% likelihood that the underlying will close within the analyzed range of $119.13-$138.48 at expiration. In this scenario, the average linear return for the trade would be 35.58%.
Big -7.55% Change: After closing the last trading session at $148.74, BUILDERS FIRSTSOURCE opened today at $147.24 and has reached a low of $136.51.
Trade approach: A movement as big as -7.55% is a significantly bearish indicator, so this trade is designed to be profitable if BLDR maintains its current direction and does not revert back to pricing on the bullish side of $137.50 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 BUILDERS FIRSTSOURCE closes at or below $138.70 on 20-Oct-2023. Based on our risk-neutral analysis, there is a 50.42% 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.