Are there advantages to selling calls at several strike prices?

There are a lot of complex moving parts. All that you can do is buy or sell the thing. Modeling is complex.

I arrive at a risk-reversal skew figure/ATM vol. An integer figure which I rank against prior Q-earnings releases. SN-vol generally has a put skew. Know where you are in the news cycle, etc. See how sector indices/ETF are performing. Perhaps do portfolio-wide hedging in index options. If your goal is to keep the shares and reduce tax-sales... then stay out of near-term CC. If you want to keep it as simple as possible: write OTM 2024 calls and revisit in 2024.
 
MathTeacher said:
Volatility will go down after the report, so the premiums will be lower even if the stock price rallies 5-10 dollars?
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No, but the vol-figure @ delta will drop. Say that the ATM strike (50D) is trading 30-vol. Post report the ATM strike for the same term will be trading 28-vol.

If you want to sell vol then you need to add duration. If you want to bet on price and distribution, short near-term.

If you're bullish then wait for the rally and sell longer dated vol. Trading Feb is not a vol-trade. I would start reading.
 
I had looked at TDA's earnings tab for a vol-figure and it's nonsense. Anyway, XOM vol term structure is essentially flat at 27% from April out to Jan 2024. You're risking 100-150bps on vol post earnings (25.5 to 26 vol). The only risk to waiting is a drop in the shares post earnings.

If I was forced to trade it... I'd wait until after the report, but it's a close call.
 
I will continue to read. I wasn't planning on getting into as complex trades as you were suggesting. Thank you for your advice. I would be snow plowing down a black diamond.
 
destriero said:
I had looked at TDA's earnings tab for a vol-figure and it's nonsense. Anyway, XOM vol term structure is essentially flat at 27% from April out to Jan 2024. You're risking 100-150bps on vol post earnings (25.5 to 26 vol). The only risk to waiting is a drop in the shares post earnings.

If I was forced to trade it... I'd wait until after the report, but it's a close call.
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Thank you for all of your time and advise. I will continue to learn.
 
The April 105C at 2.25 extrinsic doesn't look like a bad short. It will be 1.5 max after earnings with shares above 116. I'd short the 105s tomorrow and cover post report.
 
destriero said:
The April 105C at 2.25 extrinsic doesn't look like a bad short. It will be 1.5 max after earnings with shares above 116. I'd short the 105s tomorrow and cover post report.
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Sell 105C tomorrow and cover post report as in "buy to close" because the vol will drop, thus the premium will drop? And I will buy back the contract and make money.
 
You're very likely to get assigned at 105. Is it worth it to you to receive $118 net for your shares no later than April 15? It's not going to make sense to cover if trading an ITM strike as a CC.
 
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