The automated Quantcha Trade Ideas Service has detected a promising Covered Put trade opportunity for LION BIOTECH INC (LBIO) for the 21-Jul-2017 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

LBIO was recently trading at $5.25 and has an implied volatility of 111.99% for this period. Based on an analysis of the options available for LBIO expiring on 21-Jul-2017, there is a 34.14% likelihood that the underlying will close within the analyzed range of $3.36-$5.25 at expiration. In this scenario, the average linear return for the trade would be 25.65%.

Big -7.08% Change: After closing the last trading session at $5.65, LION BIOTECH INC opened today at $5.70 and has reached a low of $5.00.

Trade approach: A movement as big as -7.08% is a significantly bearish indicator, so this trade is designed to be profitable if LBIO maintains its current direction and does not revert back to pricing on the bullish side of $5.25 on 21-Jul-2017. 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 LION BIOTECH INC closes at or below $5.60 on 21-Jul-2017. Based on our risk-neutral analysis, there is a 55.84% 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.