52-Week Low Alert: Trading today’s movement in DISCOVER FINANCIAL $DFS

Quantchabot has detected a promising Bear Call Spread trade opportunity for DISCOVER FINANCIAL (DFS) for the 13-Oct-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

DFS was recently trading at $88.08 and has an implied volatility of 24.20% for this period. Based on an analysis of the options available for DFS expiring on 13-Oct-2023, there is a 34.20% likelihood that the underlying will close within the analyzed range of $82.43-$88.52 at expiration. In this scenario, the average linear return for the trade would be 30.30%.

52 week low: DISCOVER FINANCIAL recently reached a new 52-week low at $87.45. DFS had traded in the range $87.64-$122.50 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 DFS maintains its current direction and does not revert back to pricing on the bullish side of $88.08 on 13-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 DISCOVER FINANCIAL closes at or below $88.55 on 13-Oct-2023. Based on our risk-neutral analysis, there is a 50.21% 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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