The automated Quantcha Trade Ideas Service has detected a promising Long Iron Condor trade opportunity for NOVARTIS (NVS) for the 19-Jan-2018 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

NVS was recently trading at $81.36 and has an implied volatility of 15.45% for this period. Based on an analysis of the options available for NVS expiring on 19-Jan-2018, there is a 60.75% likelihood that the underlying will close within the analyzed range of $74.25-$90.75 at expiration. In this scenario, the average linear return for the trade would be 22.78%.

Price target: Zacks Research has updated their six-month price target for NVS to $82.50. This price target is a consensus price created from the price targets published by 4 participating analysts whose targets ranged from $77.00 to $92.00.

Mean recommendation: Zacks normalizes analyst recommendations to a 1-5 scale where 1 indicates a strong buy. Their mean recommendation for NVS has been updated to 1.75, which indicates a buy consensus from analysts. Sentiment has moved from 1.81 to 2.03 to 1.75 over the past three months.

Trade approach: The difference between the current price for NVS and the mean price target is $0.86, which represents a 1.40% move (2.86% annualized). Since the 180-day implied volatility for NVS is 14.86%, a neutral range-bound strategy could prove effective if the price target ultimately turns out to be accurate.

Upside potential: Using this neutral range-bound strategy, the trade would be profitable if NOVARTIS closed in the range $74.05-$90.95 on 19-Jan-2018. Based on our analysis, there is a 61.89% likelihood of this return. The maximum return for this trade would be 23.46% if NOVARTIS closed in the range $75.00-$90.00.

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.