Quantchabot has detected a promising Bear Call Spread trade opportunity for IRIDIUM COMMUNICATIONS (IRDM) for the 19-Jan-2024 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
IRDM was recently trading at $39.94 and has an implied volatility of 32.66% for this period. Based on an analysis of the options available for IRDM expiring on 19-Jan-2024, there is a 34.16% likelihood that the underlying will close within the analyzed range of $34.38-$40.53 at expiration. In this scenario, the average linear return for the trade would be 48.41%.
Big -8.75% Change: After closing the last trading session at $43.77, IRIDIUM COMMUNICATIONS opened today at $42.05 and has reached a low of $39.80.
Trade approach: A movement as big as -8.75% is a significantly bearish indicator, so this trade is designed to be profitable if IRDM maintains its current direction and does not revert back to pricing on the bullish side of $39.94 on 19-Jan-2024. 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 IRIDIUM COMMUNICATIONS closes at or below $41.65 on 19-Jan-2024. Based on our risk-neutral analysis, there is a 56.59% 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.