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Quantchabot has detected a promising Short Risk Reversal trade opportunity for ENPHASE ENERGY (ENPH) for the 19-Feb-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

ENPH was recently trading at $192.96 and has an implied volatility of 80.52% for this period. Based on an analysis of the options available for ENPH expiring on 19-Feb-2021, there is a 34.13% likelihood that the underlying will close within the analyzed range of $150.27-$192.98 at expiration. In this scenario, the average linear return for the trade would be 64.39%.

Big -7.60% Change: After closing the last trading session at $208.83, ENPHASE ENERGY opened today at $206.54 and has reached a low of $192.11.

Trade approach: A movement as big as -7.60% is a significantly bearish indicator, so this trade is designed to be profitable if ENPH maintains its current direction and does not revert back to pricing on the bullish side of $192.96 on 19-Feb-2021. 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 ENPHASE ENERGY closes at or below $199.84 on 19-Feb-2021. Based on our risk-neutral analysis, there is a 55.55% 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.