In the classic science-fiction film “The Matrix,” the main character learns a thought-provoking lesson about the nature of reality. Similarly, in trading, the concept of valuation may not be as straightforward as it seems. Instead of focusing on labels like “undervalued” or “overvalued,” traders should consider probabilistic mass and risk geometry to make informed decisions.

For Oracle (ORCL), analyzing hundreds of rolling 10-week sequences can provide insights into the stock’s performance probabilities. The options market anticipates a wide price range for ORCL, but a distributional analysis suggests potential outcomes between $187.50 and $206. A bull call spread strategy could be a prudent idea based on the current quantitative signals.

NextEra Energy (NEE) has underperformed this year despite its significant market cap. The Expected Move calculator projects a price range for NEE, but a distributional analysis indicates potential outcomes between $78 and $83. A bull spread strategy could present an opportunity for traders considering the current quantitative signals.

Iron Mountain (IRM) has struggled this year, presenting a potential contrarian play for traders. The Expected Move calculator shows an anticipated price range for IRM, with distributional analysis suggesting potential outcomes between $79 and $84.60. A bull spread strategy, such as the 80/90 spread, could offer a compelling opportunity for traders looking for a max payout of 150%.

Read more at Barchart: How a Little-Known Options Strategy Targets Asymmetric Upside (ORCL, NEE, IRM)