Tuesday, July 19, 2016

Wednesday's Prospects

On Tuesday, July 19:

Of 504 large-cap stocks and exchange-traded funds in my analytical universe, one meets my criteria for further consideration. I already hold a position in it.

There are no prospects for trades coinciding with earnings announcements.

Lacking prospects, I shall do no further analysis on Wednesday, July 20, unless conditions change for the symbols listed in the "Assessment" section.

The next earnings season began on July 11 and will last for six weeks, through Aug. 19.

The FINTECH Book: The Financial Technology Handbook for Investors, Entrepreneus and Visionaries
by Susanne Chishti

Symbols meeting or close to meeting implied volatility criteria

IV qualifies


In portfolio


Seven symbols qualify as potential earnings plays in all ways except the level of implied volatility. I require volatility in the 50th percentile of its annual range; the seven have volatility below the 40th percentile.

In the unlikely event that any should exceed the 50th percentile in trading on Wednesday, then I shall move forward with further analysis.

The symbols are DHI, EBAY, GM, INTC, JCI, LUV and NEM.


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 19, 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 datnillc@gmail.com.


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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.

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