The automated Quantcha Trade Ideas Service has detected a promising
AMTD was recently trading at $40.37 and has an implied volatility of 26.55% for this period. Based on an analysis of the options available for AMTD expiring on 17-Mar-2017, there is a 34.15% likelihood that the underlying will close within the analyzed range of $38.21-$40.43 at expiration. In this scenario, the average linear return for the trade would be 74.13%.
Big -7.54% Change: After closing the last trading session at $43.66, TD AMERITRADE HOLDING opened today at $41.00 and has reached a low of $40.17.
Trade approach: A movement as big as -7.54% is a significantly bearish indicator, so this trade is designed to be profitable if AMTD maintains its current direction and does not revert back to pricing on the bullish side of $40.37 on 17-Mar-2017. 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 TD AMERITRADE HOLDING closes at or below $40.45 on 17-Mar-2017. Based on our risk-neutral analysis, there is a 50.28% 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 11:30:02 AM ET. The analysis does not include brokerage fees or commissions and is not investment advice.