U.S. Markets open in 1 hr 23 mins
  • S&P Futures

    4,218.75
    +5.00 (+0.12%)
     
  • Dow Futures

    33,782.00
    +21.00 (+0.06%)
     
  • Nasdaq Futures

    14,167.50
    +37.50 (+0.27%)
     
  • Russell 2000 Futures

    2,278.20
    -2.70 (-0.12%)
     
  • Crude Oil

    73.15
    -0.51 (-0.69%)
     
  • Gold

    1,781.90
    -1.00 (-0.06%)
     
  • Silver

    25.98
    -0.05 (-0.19%)
     
  • EUR/USD

    1.1896
    -0.0028 (-0.2379%)
     
  • 10-Yr Bond

    1.4840
    0.0000 (0.00%)
     
  • Vix

    17.49
    -3.21 (-15.51%)
     
  • GBP/USD

    1.3904
    -0.0029 (-0.2072%)
     
  • USD/JPY

    110.5440
    +0.2460 (+0.2230%)
     
  • BTC-USD

    30,659.33
    -1,699.15 (-5.25%)
     
  • CMC Crypto 200

    732.55
    -117.79 (-13.85%)
     
  • FTSE 100

    7,086.18
    +23.89 (+0.34%)
     
  • Nikkei 225

    28,884.13
    +873.20 (+3.12%)
     

Do Options Traders Know Something About Azul (AZUL) Stock We Don't?

  • Oops!
    Something went wrong.
    Please try again later.
·2 min read
  • Oops!
    Something went wrong.
    Please try again later.

Investors in Azul S.A. AZUL need to pay close attention to the stock based on moves in the options market lately. That is because the Jul 17, 2020 $17.50 Call had some of the highest implied volatility of all equity options today.

What is Implied Volatility?

Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean there is an event coming up soon that may cause a big rally or a huge sell-off. However, implied volatility is only one piece of the puzzle when putting together an options trading strategy.

What do the Analysts Think?

Clearly, options traders are pricing in a big move for Azul shares, but what is the fundamental picture for the company? Currently, Azul is a Zacks Rank #3 (Hold) in the Transportation - Airline industry that ranks in the Top 34% of our Zacks Industry Rank. Over the last 60 days, the Zacks Consensus Estimate for the current quarter has widened from a loss of 79 cents per share to a loss of $1.11.

Given the way analysts feel about Azul right now, this huge implied volatility could mean there’s a trade developing. Oftentimes, options traders look for options with high levels of implied volatility to sell premium. This is a strategy many seasoned traders use because it captures decay. At expiration, the hope for these traders is that the underlying stock does not move as much as originally expected.

Looking to Trade Options?

Check out the simple yet high-powered approach that Zacks Executive VP Kevin Matras has used to close recent double and triple-digit winners. In addition to impressive profit potential, these trades can actually reduce your risk.

Click to see the trades now >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
AZUL SA (AZUL) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research