Quantchabot has detected a promising Bear Call Spread trade opportunity for DXC TECHNOLOGY CO (DXC) for the 20-Oct-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
DXC was recently trading at $20.20 and has an implied volatility of 42.68% for this period. Based on an analysis of the options available for DXC expiring on 20-Oct-2023, there is a 34.70% likelihood that the underlying will close within the analyzed range of $19.36-$20.22 at expiration. In this scenario, the average linear return for the trade would be 29.09%.
Big -9.19% Change: After closing the last trading session at $22.25, DXC TECHNOLOGY CO opened today at $20.75 and has reached a low of $20.15.
Trade approach: A movement as big as -9.19% is a significantly bearish indicator, so this trade is designed to be profitable if DXC maintains its current direction and does not revert back to pricing on the bullish side of $20.20 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 DXC TECHNOLOGY CO closes at or below $20.25 on 20-Oct-2023. Based on our risk-neutral analysis, there is a 51.58% 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.