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Quantchabot has detected a promising Bull Put Spread trade opportunity for ARCHER-DANIELS MIDLAND (ADM) for the 23-Oct-2020 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

ADM was recently trading at $51.48 and has an implied volatility of 23.57% for this period. Based on an analysis of the options available for ADM expiring on 23-Oct-2020, there is a 34.14% likelihood that the underlying will close within the analyzed range of $51.48-$52.47 at expiration. In this scenario, the average linear return for the trade would be 27.02%.

52 week high: ARCHER-DANIELS MIDLAND recently reached a new 52-week high at $51.51. ADM had traded in the range $28.92-$51.47 over the past year.

Trade approach: Reaching a new 52-week high is a bullish indicator, so this trade is designed to be profitable if ADM maintains its current direction and does not revert back to pricing on the bearish side of $51.48 on 23-Oct-2020. If possible, the trade has been padded such that slight movement against the trade would still return a profit.

Upside potential: Using this bullish strategy, the trade would be profitable if ARCHER-DANIELS MIDLAND closes at or above $51.45 on 23-Oct-2020. Based on our risk-neutral analysis, there is a 51.24% 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.