Quantchabot has detected a new Covered Put trade opportunity for VALE (VALE) for the 14-Feb-2025 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.
VALE was recently trading at $8.68 and has an implied volatility of 51.56% for this period. Based on an analysis of the options available for VALE expiring on 14-Feb-2025, there is a 34.20% likelihood that the underlying will close within the analyzed range of $7.31-$8.72 at expiration. In this scenario, the average linear return for the trade would be 12.12%.
52 week low: VALE recently reached a new 52-week low at $8.66. VALE had traded in the range $8.69-$15.66 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 VALE maintains its current direction and does not revert back to pricing on the bullish side of $8.68 on 14-Feb-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 VALE closes at or below $8.76 on 14-Feb-2025. Based on our risk-neutral analysis, there is a 51.01% 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.
Leave a Reply
You must be logged in to post a comment.