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IV trading on earnings
- Thread starter DarkProtoman
- Start date
hahahah wow, way to kill your account. this isn't rocket science, you use a short straddle IF you wish to attempt this at all
never go into earnings directionally.
high probability for IV crush if you sell straddle the day before earnings release
high probability of gains if you buy straddle a few days before earnings release
never go into earnings directionally.
high probability for IV crush if you sell straddle the day before earnings release
high probability of gains if you buy straddle a few days before earnings release
Quote from newwurldmn:
Okay. So now you think that PFE will go up. Before you were talking about profiting from any direction by selling implied vol. Now you are talking about profiting from a rally by buying implied vol. I think that you are a little confused in your view here. If I were you, I wouldn't trade this right now.
Well, this second strategy (to simply profit from long-term directionality) was my original one, because Pfizer looks poised to beat its earning estimates, like it did for nearly 3 years.
And it has widened its planned share repurchase program to $2B, which will drive up the price somewhat.
Quote from cqm:
hahahah wow, way to kill your account. this isn't rocket science, you use a short straddle IF you wish to attempt this at all
never go into earnings directionally.
high probability for IV crush if you sell straddle the day before earnings release
high probability of gains if you buy straddle a few days before earnings release
That seems much better than taking on an unlimited risk.
Quote from DarkProtoman:
Well, this second strategy (to simply profit from long-term directionality) was my original one, because Pfizer looks poised to beat its earning estimates, like it did for nearly 3 years.
And it has widened its planned share repurchase program to $2B, which will drive up the price somewhat.
Okay. Without any sense for how much you think the stock will move, you are better off buying stock instead of calls.