Quantcha now offering unlimited commission-free options trading. Quantchabot has detected a promising Short Risk Reversal trade opportunity for LUCKIN COFFEE INC. AMERICAN DEPOSITARY SHARES (LK) for the 29-May-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine. LK was recently trading at $2.02 and has an implied volatility of 308.98% for this period. Based on an analysis of the options available for LK expiring on 29-May-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $1.26-$2.02 at expiration. In this scenario, the average linear return for the trade would be 85.19%. 52 week low: LUCKIN COFFEE INC. AMERICAN DEPOSITARY SHARES recently reached a new 52-week low at $2.01. LK had traded in the range $4.27-$51.38 over the past year. Trade approach: Reaching a new 52-week low is a bearish indicator, so this trade is designed to be profitable if LK maintains its current direction and does not revert back to pricing on the bullish side of $2.02 on 29-May-2020. 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 LUCKIN COFFEE INC. AMERICAN DEPOSITARY SHARES closes at or below $2.07 on 29-May-2020. Based on our risk-neutral analysis, there is a 52.30% 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. To analyze this trade in depth, please visit the Quantcha Options Search Engine.