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52-Week Low Alert: Trading today’s movement in NORDSTROM

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Quantchabot has detected a promising Covered Put trade opportunity for NORDSTROM (JWN) for the 6-Nov-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

JWN was recently trading at $11.99 and has an implied volatility of 111.76% for this period. Based on an analysis of the options available for JWN expiring on 6-Nov-2020, there is a 34.13% likelihood that the underlying will close within the analyzed range of $8.16-$12.00 at expiration. In this scenario, the average linear return for the trade would be 31.28%.

52 week low: NORDSTROM recently reached a new 52-week low at $11.72. JWN had traded in the range $12.27-$43.37 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 JWN maintains its current direction and does not revert back to pricing on the bullish side of $11.99 on 6-Nov-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 NORDSTROM closes at or below $12.04 on 6-Nov-2020. Based on our risk-neutral analysis, there is a 50.37% 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.

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