Quantchabot has detected a new Bear Call Spread trade opportunity for VALARIS LTD (VAL) for the 17-Jan-2025 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
VAL was recently trading at $40.42 and has an implied volatility of 47.33% for this period. Based on an analysis of the options available for VAL expiring on 17-Jan-2025, there is a 34.24% likelihood that the underlying will close within the analyzed range of $35.84-$40.54 at expiration. In this scenario, the average linear return for the trade would be 47.17%.
52 week low: VALARIS LTD recently reached a new 52-week low at $39.90. VAL had traded in the range $40.41-$84.20 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 VAL maintains its current direction and does not revert back to pricing on the bullish side of $40.42 on 17-Jan-2025. 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 VALARIS LTD closes at or below $40.70 on 17-Jan-2025. Based on our risk-neutral analysis, there is a 51.25% 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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