The automated Quantcha Trade Ideas Service has detected a promising
LXRX was recently trading at $16.26 and has an implied volatility of 83.37% for this period. Based on an analysis of the options available for LXRX expiring on 21-Jul-2017, there is a 68.27% likelihood that the underlying will close within the analyzed range of $9.75-$27.38 at expiration. In this scenario, the average linear return for the trade would be 12.27%.
Moneyness: These options are currently 23.23% out of the money and there is a 31.83% likelihood that these options will be exercised before or at expiration.
Most upside: If LEXICON PHARMACEUTICALS closes at or above $20.00, this trade could return up to 31.93%. Based on our analysis, there is a 34.76% likelihood of this return.
The downside: As with any covered call, the risk is substantial as it is vulnerable to a downturn in the underlying itself. There is a 44.24% chance the underlying will close at or below its breakeven price of $15.16, resulting in a net loss on the trade.
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This is an automated post generated based on a market analysis of delayed data at 2/28/2017 11:26:06 AM ET. The analysis does not include brokerage fees or commissions and is not investment advice.