Today’s model portfolio spans 3 quantitatively-scored trades across our watchlist.
Each position is sized to fit within a $6,667 budget slice. The post below is a deep dive on one of those trades — use the table to explore the others.
Today’s $20,000 Model Portfolio · 3 Trades
| Ticker & Strategy | POP | Max Profit | Contracts | Allocated |
|---|---|---|---|---|
| NOWTHIS POSTBear Call Spread | 95% | $1,230 | 15 lots | $6,279 |
| SPCXBear Put Spread↗ | 51% | $6,533 | 13 lots | $6,468 |
| METABear Call Spread↗ | 76% | $1,205 | 2 lots | $4,810 |
| Portfolio Total | $8,968 | 3 trades | $17,556 (+51.1% if max profit) |
Equal-weight sizing: $20,000 split across 3 trades at $6,667 per position. Contracts = floor(position budget ÷ max risk per contract) so each trade stays within its risk envelope. POP = probability of profit at expiration (model-derived). Max Profit = maximum gain if held to expiration and the spread expires at full profit. Click any row to read the full trade analysis.
Company & Market Context
ServiceNow, Inc. (NOW) is a leading enterprise software platform in the Technology sector, delivering cloud-based workflow automation and IT service management solutions to large organizations worldwide. The stock has drawn attention in the current options cycle due to a notably elevated implied volatility environment — with at-the-money implied volatility running above 50% — which tends to inflate option premiums and create favorable conditions for credit spread strategies. Momentum indicators tracked by QuantMint's systematic screening process currently reflect a bearish near-term bias, adding further context to the directional setup described below.
Why This Trade Setup
The Bear Call Spread is a defined-risk, short-premium strategy that collects a net credit upfront by selling a call at a higher strike and buying a further out-of-the-money call as a hedge. It profits when the underlying stays below the short strike at expiration — expressing a neutral-to-bearish market view over the 21-day holding period. This setup was surfaced through probability-weighted scoring derived from Black-Scholes pricing models and implied volatility regime analysis. The composite quantitative score of 0.94 out of 1.00 reflects a high-conviction configuration: strikes placed well above the current underlying price, a probability of profit near 95%, and an elevated volatility regime that makes the collected premium meaningful relative to the risk taken. The position sizing framework allocates a defined slice of an illustrative $20,000 portfolio to this trade, capping the capital at risk to a specific, pre-calculated amount across 15 contracts.
Key Risks
- Sharp upside move: A sudden rally in NOW above the short call strike before expiration would work against this position. Maximum loss is fixed and known at entry — an estimate, not a promise of the worst-case outcome in all scenarios.
- Volatility expansion: A spike in implied volatility can increase the mark-to-market value of the spread before expiration, creating unrealized losses even if the stock hasn't breached the strike.
- Early assignment risk: Although uncommon with European-style index options, equity options carry early assignment risk on the short leg, particularly around dividend dates or deep in-the-money scenarios.
- Liquidity risk: Wider bid-ask spreads at execution can erode the net credit received versus the modelled estimate.
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Important Disclaimer: This content is generated automatically for informational and educational purposes only. It does not constitute financial advice, a solicitation, or a recommendation to buy or sell any security. Options trading involves significant risk and may not be suitable for all investors. You may lose more than your initial investment. Past performance does not guarantee future results. Always conduct your own due diligence and consult a qualified financial advisor before making any investment decisions. QuantMint is not a registered investment adviser.