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These earnings butterfly strategies are dangerous. I did my last one yesterday. It works for a while, but the problem is when you lose money, you lose big. However, do you agree that the pre-earnings straddle strategy works? If you find a stock that is highly volatile (FB, LNKD, GRPN), the...

I think the cisco butterfly would have been a loser if you held till afternoon if you bought the atm fly..i.e. middle strike at 17. I specifically remember csco straddle trading in the 1.40s. The jump is higher than straddle price .

Yes, I do look at them historically, but seems to me like it doesn't matter. A good example would be the PCLN straddle pre-earnings, which was trading at a discount compared to historical norm. Instead of the straddle running up prior to earnings, it went down. What we should discuss is...

I bought the NTES SEP 50/57.5/65 butterfly yesterday for 2.85. I wonder if I paid too much here. But in any event, NTES dropped big. Showing some loss here. Bought CSCO straddle for pre-earnings run-up. Had to sell for a loss. Could have timed it better.

Sold GRPN straddle for 2.10. I may buy a September or October butterfly at the end of the day.

I just bought GRPN straddle for 1.75. I will sell my straddle prior to earnings on Monday. I also bought JCP butterfly yesterday. Made some money there. However, I sold my straddle too early yesterday. If I waited till 3:30 or so, I would have made some money. I bought the fly once I sold...

By 7.50 wide butterfly, do you mean the September 45/52.5/60 butterfly? I see that going for 2.55 on thinkorswim. Or do you mean the August? The August fly is going close to 3.

GRPN earnings out on monday after hours. I was thinking of buying a straddle on it, but I changed my mind.

What you can also try to do is buy a butterfly on stocks that moved strongly last earnings announcement..i tried to do that with gmcr..however stock went up 30%. My loss wasnt much though..almost breakeven..imagine if the stock doesnt move .easy double if you ask me... grpn may be a stock for...

Bought the JCP straddle yesterday. Earnings out tomorrow. Let's see how it goes. I will sell it today. I must mention that I bought the straddle without even looking at volatility. All I know is JCP was a far less volatile stock last earnings. This could go up or down 20% easily.

So how do you determine when to enter? I have been moderately successful with this strategy, but I don't think I have a 65% hit rate.

This strategy may be getting too crowded. Jeff Augen wrote about this strategy in one of his books. Steadyoptions.com also exclusively uses this strategy.

Yes, I agree that straddles are risky, but sometimes you need to look at risk/reward. 8% (it was actually less than that) implied move is low risk and high reward given that PCLN has a history of making big moves. I am not claiming to be an expert here. I don't buy straddles to hold them...

Dumbass marketmakers lost some money. Told you all. Less than 8% implied move for a stock that has a history of making big moves? Give me a break.

Someone posted PCLN post-earnings move on seeking alpha. Based on this history, seems to me like PCLN straddle will probably make money if you hold it for two days. It more often than not makes >8% move in two days...

The stock is up around 2 and a half % with no news. Frankly, I expect it to jump or tank more than 10% after earnings. Yes, straddles rarely make money, but sometimes you need to look at risk/reward. What's the worst that can happen here? You lose 60-70% loss at worst IMHO. Best case scenario...

The August straddle predicts a move of only 8%. This might as well happen, but given that PCLN has a history of making big moves, an 8% prediction seems to be low to me. Last earnings, PCLN moved only around 2%. I doubt this happens again. I don't normally hold straddles after earnings, but...

The FB straddle went down in price today. However, I still ended up with a gain (albeit very slight). The AMZN straddle that I bought yesterday made me more money. I am out of both the straddles now. Next week, I am looking at LNKD. They report earnings on August 2. I bought LNKD 105/105...

My plan is to sell the straddle before earnings announcement. The announcement is after hours. I am trying to take advantage of increase in volatility before the event. I expect speculators to drive up the price of the options.

I own a FB straddle. Bought it two days ago. My plan was to sell it pre-earnings. Really did not anticipate Znga making such an impact. In any event, I still expect the straddle to trade higher. I gained some $$$ yesterday, but I don't know what impact Znga will have on volatility. My...