The automated Quantcha Trade Ideas Service has detected a promising
WM was recently trading at $73.15 and has an implied volatility of 9.90% for this period. Based on an analysis of the options available for WM expiring on 21-Apr-2017, there is a 34.14% likelihood that the underlying will close within the analyzed range of $73.37-$76.57 at expiration. In this scenario, the average linear return for the trade would be 43.28%.
52 week high: WASTE MANAGEMENT recently reached a new 52-week high at $73.53. WM had traded in the range $55.50-$73.30 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 WM maintains its current direction and does not revert back to pricing on the bearish side of $73.15 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 WASTE MANAGEMENT closes at or above $73.20 on 21-Apr-2017. Based on our risk-neutral analysis, there is a 52.19% 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 1:20:16 PM ET. The analysis does not include brokerage fees or commissions and is not investment advice.