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

VMW was recently trading at $95.42 and has an implied volatility of 20.57% for this period. Based on an analysis of the options available for VMW expiring on 19-Jan-2018, there is a 39.54% likelihood that the underlying will close within the analyzed range of $84.17-$102.88 at expiration. In this scenario, the average linear return for the trade would be 73.77%.

Price target: Zacks Research has updated their six-month price target for VMW to $93.53. This price target is a consensus price created from the price targets published by 19 participating analysts whose targets ranged from $67.00 to $115.00.

Mean recommendation: Zacks normalizes analyst recommendations to a 1-5 scale where 1 indicates a strong buy. Their mean recommendation for VMW has been updated to 2.15, which indicates a buy consensus from analysts. Sentiment has moved from 2.15 to 2.15 to 2.18 over the past three months.

Trade approach: The difference between the current price for VMW and the mean price target is $1.42, which represents a 1.98% move (4.07% annualized). Since the 180-day implied volatility for VMW is 23.74%, 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 VMWARE closed in the range $83.75-$103.75 on 19-Jan-2018. Based on our analysis, there is a 42.01% likelihood of this return. The maximum return for this trade would be 100.00% if VMWARE closed in the range $90.00-$97.50.

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.