Wednesday's Agenda

If this first full week of earnings season is a true indicator, we have entered an era of low volatility, in comparison with the high volatility of the summer. For my trading, this means it is harder to find earnings plays, since that strategy relies on a collapse of volatility from the heights in order to turn a profit.

Only one of the six prospects for earnings plays today -- NFLX -- has implied volatility above the midpoint of its range for the past 12 months. Volatility for NFLX stands at the 85th percentile.

The other five have all declined below the midpoint. BBT is highest at the 43rd percentile, and the others -- UNH, C, USB and GS -- are all below the 40th percentile.

I shall analyze NFLX as a potential trade and forget the rest.

-- Tim Bovee, Portland, Oregon, Oct. 14, 2015

References

Tradecraft: Playing the odds to build winning stock market trades from options, a description of how I trade, can be read here.

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Disclaimer

Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.

License



All content on Tim Bovee, Private Trader by Timothy K. Bovee is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

Based on a work at www.timbovee.com.