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Quantchabot has detected a promising Bear Call Spread trade opportunity for VIRGIN GALACTIC HOLDINGS INC (SPCE) for the 19-Feb-2021 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

SPCE was recently trading at $54.27 and has an implied volatility of 121.29% for this period. Based on an analysis of the options available for SPCE expiring on 19-Feb-2021, there is a 34.14% likelihood that the underlying will close within the analyzed range of $45.69-$54.27 at expiration. In this scenario, the average linear return for the trade would be 52.04%.

Big -8.65% Change: After closing the last trading session at $59.41, VIRGIN GALACTIC HOLDINGS INC opened today at $53.35 and has reached a low of $52.30.

Trade approach: A movement as big as -8.65% is a significantly bearish indicator, so this trade is designed to be profitable if SPCE maintains its current direction and does not revert back to pricing on the bullish side of $54.27 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 VIRGIN GALACTIC HOLDINGS INC closes at or below $54.44 on 19-Feb-2021. Based on our risk-neutral analysis, there is a 50.72% 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.