Quantchabot has detected a new Bull Call Spread trade opportunity for RED CAT HOLDINGS INC. COMMON STOCK (RCAT) for the 9-May-2025 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
RCAT was recently trading at $5.80 and has an implied volatility of 89.84% for this period. Based on an analysis of the options available for RCAT expiring on 9-May-2025, there is a 35.50% likelihood that the underlying will close within the analyzed range of $5.81-$6.16 at expiration. In this scenario, the average linear return for the trade would be 10.48%.
Big 7.90% Change: After closing the last trading session at $5.38, RED CAT HOLDINGS INC. COMMON STOCK opened today at $5.55 and has reached a high of $5.82.
Trade approach: A movement as big as 7.90% is a significantly bullish indicator, so this trade is designed to be profitable if RCAT maintains its current direction and does not revert back to pricing on the bearish side of $5.80 on 9-May-2025. 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 RED CAT HOLDINGS INC. COMMON STOCK closes at or above $5.80 on 9-May-2025. Based on our risk-neutral analysis, there is a 50.74% 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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