Earning results and trading

Discussion in 'Trading' started by privador81, Sep 29, 2012.

  1. I have tried to trade prior company earnings.

    But i have noticed one thing. Chart starts to move a lot faster than public news release. Sometimes even 30sec
    Can someone explain that fact?
    So someone gets news faster than others?
    Which channel is best for giving earning results realtime

    And secondly why there are not halt before any earning and who get gains by filling orders, which hasnt canceled yet.
  2. if price moves b4 earnings release it's b/c traders are getting flat/putting on positions before the release.

    bloomberg is usually the fastest to report the release (terminal subscribers not the tv channel and def not the website open for the public).

    you will NOT get the news first by watching tv.

    there isn't a halt b4 earnings so there's no need to question why there should be one given it will never happen.

    not sure re your last question re getting filled and cancelled.
  3. NoDoji


    The institutional traders/investors utilize sophisticated programs to interpret news reports and trade off them:


    If you've watched price following an earnings announcement you'll notice that very often it jumps one direction only to quickly retrace and run the other direction. What you likely have here is the algos reacting to key words/phrases almost instantaneously. As the big players interpret the meaning behind the news, the picture changes.

    Imagine AMZN announces an earnings miss and price immediately tanks 20 points as algos trigger selling which triggers more selling. Then the details behind the naked earnings number emerge during the conference call and we find out there's no fundamentally negative reason for the miss and better yet they're raising earnings guidance for next quarter and next year. Now price suddenly recovers the entire 20 points and starts making new highs.

    The best way to trade earnings is to wait for the regular trading session to start and let the price action show you what the institutional players are doing. You want to piggy back the forces that move price, not fight them based on your personal bias or personal interpretation of news.

    I'm sure you've seen a heavily shorted company clearly headed for bankruptcy with straight quarterly losses for the past two years report a slightly smaller than expected loss and take off like a rocket. It's a short squeeze and if the short interest is high enough, it can run for days. You'll make money faster and easier trading with the trend even though you feel like a total idiot going long. When you go to spend the profits you made I promise that no one will ever say, "Sorry we can't accept your payment because you were one of those idiots who went long that piece of crap company."
  4. Most quantitative funds (CTAs, managed futures, etc) do things differently. And most of them never put fundamentals into models.
  5. Can u compare which site is faster to publish earnings?
    fly, bloomberg terminal, reuters, briefing or just official site?

    But u are right. When u want to play into earnings. U must wait till Big money(institution) starts to action, then u can join trend game.

    Is there anyone who constantly makes money on earnings?