The automated Quantcha Trade Ideas Service has detected a promising
JPM was recently trading at $90.07 and has an implied volatility of 19.19% for this period. Based on an analysis of the options available for JPM expiring on 18-Aug-2017, there is a 43.01% likelihood that the underlying will close within the analyzed range of $73.75-$90.14 at expiration. In this scenario, the average linear return for the trade would be 82.19%.
Price target: Zacks Research has updated their six-month price target for JPM to $81.94. This price target is a consensus price created from the price targets published by 18 participating analysts whose targets ranged from $50.00 to $102.00.
Mean recommendation: Zacks normalizes analyst recommendations to a 1-5 scale where 1 indicates a strong buy. Their mean recommendation for JPM has been updated to 2.27, which indicates a buy consensus from analysts. Sentiment has moved from 2.23 to 2.32 to 2.27 over the past three months.
Trade approach: The difference between the current price for JPM and the mean price target is $4.07, which represents a 9.02% move (19.14% annualized). Since the 180-day implied volatility for JPM is 20.55%, a bearish strategy could prove effective if the price target ultimately turns out to be accurate.
Upside potential: Using this bearish strategy, the trade would be profitable if JPMORGAN CHASE closed at or below $91.00 on 18-Aug-2017. Based on our analysis, there is a 53.89% 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 11:21:07 AM ET. The analysis does not include brokerage fees or commissions and is not investment advice.