Quantchabot has detected a promising Bear Call Spread trade opportunity for UNITED AIRLINES HOLDINGS INC (UAL) for the 15-Dec-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
UAL was recently trading at $35.49 and has an implied volatility of 40.86% for this period. Based on an analysis of the options available for UAL expiring on 15-Dec-2023, there is a 34.17% likelihood that the underlying will close within the analyzed range of $30.48-$35.81 at expiration. In this scenario, the average linear return for the trade would be 41.25%.
52 week low: UNITED AIRLINES HOLDINGS INC recently reached a new 52-week low at $35.15. UAL had traded in the range $36.14-$58.23 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 UAL maintains its current direction and does not revert back to pricing on the bullish side of $35.49 on 15-Dec-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 UNITED AIRLINES HOLDINGS INC closes at or below $35.83 on 15-Dec-2023. Based on our risk-neutral analysis, there is a 50.16% 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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