DailyPlay – Opening Trade (RACE) – October 7, 2024

RACE Bearish Opening Trade Signal

Investment Rationale

RACE recently broke down above its trading range with strong momentum an underperforming the S&P 500, providing an opportunity for further downside to our $400 target. With industry leading growth rates and profitability metrics, RACE warrants a premium valuation relative to its peers, but at more than 4x the industry average, RACE has significant downside risks to its valuation.

RACE – Daily

Trade Details

Strategy Details

Strategy: Long Put Vertical Spread

Direction: Bearish Debit Spread

Details: Buy to Open 2 RACE November 15 $460/$440 Put Vertical Spreads @ $9.05 Debit per Contract.

Total Risk: This trade has a max risk of $1,810 (2 Contracts x $905) based on a hypothetical $100,000 portfolio risking 2%. We suggest using 2% of your portfolio value and divide it by $905 to select the # contracts for your portfolio.

Trend Continuation Signal: This is a bearish trade on a stock that is trading lower from a previous high.

1M/6M Trends: Bearish/Neutral

Relative Strength: 4/10

OptionsPlay Score: 116

Stop Loss: @ $4.53 (50% loss of premium)

View RACE Trade

Entering the Trade

Use the following details to enter the trade on your trading platform. Please note that whenever there is a multi-leg option strategy, it should be entered as a single trade. 

PLEASE NOTE that these prices are based on Friday’s closing prices. Should the underlying move significantly during the pre-market hours, we will likely adjust the strikes and prices to reflect a more accurate trade entry. 

View RACE Trade