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Quantchabot has detected a promising Long Risk Reversal trade opportunity for FUTU HOLDINGS LTD ADS (FUTU) for the 18-Mar-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

FUTU was recently trading at $48.85 and has an implied volatility of 90.49% for this period. Based on an analysis of the options available for FUTU expiring on 18-Mar-2022, there is a 34.14% likelihood that the underlying will close within the analyzed range of $48.85-$70.35 at expiration. In this scenario, the average linear return for the trade would be 109.21%.

Big 7.34% Change: After closing the last trading session at $45.51, FUTU HOLDINGS LTD ADS opened today at $44.55 and has reached a high of $48.96.

Trade approach: A movement as big as 7.34% is a significantly bullish indicator, so this trade is designed to be profitable if FUTU maintains its current direction and does not revert back to pricing on the bearish side of $48.85 on 18-Mar-2022. 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 FUTU HOLDINGS LTD ADS closes at or above $46.84 on 18-Mar-2022. Based on our risk-neutral analysis, there is a 54.59% 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.