Quantchabot has detected a promising Bull Call Spread trade opportunity for EHANG HOLDINGS LTD. ADR OVERVIEW (EH) for the 17-Nov-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
EH was recently trading at $20.87 and has an implied volatility of 110.28% for this period. Based on an analysis of the options available for EH expiring on 17-Nov-2023, there is a 34.20% likelihood that the underlying will close within the analyzed range of $20.97-$29.02 at expiration. In this scenario, the average linear return for the trade would be 12.54%.
Big 8.58% Change: After closing the last trading session at $19.22, EHANG HOLDINGS LTD. ADR OVERVIEW opened today at $19.01 and has reached a high of $21.10.
Trade approach: A movement as big as 8.58% is a significantly bullish indicator, so this trade is designed to be profitable if EH maintains its current direction and does not revert back to pricing on the bearish side of $20.87 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 bullish strategy, the trade would be profitable if EHANG HOLDINGS LTD. ADR OVERVIEW closes at or above $18.05 on 17-Nov-2023. Based on our risk-neutral analysis, there is a 67.85% 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.