The rapid changes in implied volatility that accompany earnings announcements makes those 24 weeks of the year periods of great opportunity. But summer fun has come to an end, and begins the dreary wait until autumn celebration of corporate results.
Out of 116 earnings announcements next week, there are only two symbols that meet the minimum requirements for further analysis using my volatility strategy: Adequate liquidity, meaning average volume of 3 million shares or more per day, and the presence of stock options.
I shall assess the two symbols on action day and, if they qualify, proceed with a full analysis and perhaps a trade.
Also, on the appropriate action ays I shall assess symbols with lower liquidity for trades using my small lots shares strategy.
By Tim Bovee, Portland, Oregon, Aug. 18, 2016
by Spencer Jakab
Tradecraft: Playing the odds to build winning stock market trades from options, a description of how I trade, can be read here.
Small Lots: A new strategy discusses the thinking behind the analysis that identified these trades and can be read here. The symbols noted in this post are intended fortrading on a commission-free platform such as Robinhood Financial.
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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.License
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