The automated Quantcha Trade Ideas Service has detected a promising
HON was recently trading at $124.89 and has an implied volatility of 16.30% for this period. Based on an analysis of the options available for HON expiring on 21-Apr-2017, there is a 34.14% likelihood that the underlying will close within the analyzed range of $125.26-$132.96 at expiration. In this scenario, the average linear return for the trade would be 35.55%.
52 week high: HONEYWELL INTERNATIONAL recently reached a new 52-week high at $125.72. HON had traded in the range $101.28-$125.42 over the past year.
Trade approach: Reaching a new 52-week high is a bullish indicator, so this trade is designed to be profitable if HON maintains its current direction and does not revert back to pricing on the bearish side of $124.89 on 21-Apr-2017. 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 HONEYWELL INTERNATIONAL closes at or above $124.99 on 21-Apr-2017. Based on our risk-neutral analysis, there is a 51.44% 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.
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This is an automated post generated based on a market analysis of delayed data at 2/28/2017 11:28:38 AM ET. The analysis does not include brokerage fees or commissions and is not investment advice.