Of 490 large-cap stocks and exchange-traded funds in my analytical universe, none meet my criteria for further consideration.
There are no prospects for trades coinciding with earnings announcements.
Lacking prospects, I shall do no further analysis on Tuesday, July 12.
The next earnings season began on July 11 and will last for six weeks, through Aug. 19.
by Adam Grant
DAL was on the large list for consideration as an earnings play, but its implied volatility remains below my requirement of the midpoint or higher of the one-year range. So it's off the table unless there is a significant increase in volatility on Tuesday.
The stocks in my analytical universe all have analyst coverage through the stock-ranking company Zacks Investment Research. Not all of the exchange-traded funds are so covered.
I screen for 1) suitability of the options grid, including open interest of three figures or greater on the strike prices I would need to use to build a position and 2) the absence of an earnings announcement within the lifespan of the like options series I would trade, 3) implied volatility in the 50th percentile or greater of its annual range, 4) average volume of 3 million shares a day or greater, and 5) a price of $20 or greater.
-- Tim Bovee, Portland, Oregon, July 11, 2016
Tradecraft: Playing the odds to build winning stock market trades from options, a description of how I trade, can be read here.
I can be reached via comments on Private Trader posts or by email at email@example.com.
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