Earnings strangles

Discussion in 'Options' started by akivak, Nov 15, 2011.

  1. akivak

    akivak

    Thank you.
    I published another article - http://seekingalpha.com/article/311396-how-i-trade-autozone-before-earnings where I linked to Investopedia, but I agree with you regarding Options Guide. Next time..
     
    #21     Dec 2, 2011
  2. jonescd

    jonescd

    with the strangle for earnings plays. im trying to get my head around what you guys wouldn't wait to sell off after the ER is released the next day. for example if a pm earnings then opening market spikes 20pct wouldnt a strangle or straddle hedge be more profitable or not? can you please explain why that would be. also what about other catalyst plays other than earnings, how would you configure your strangle to maximize the chance of profit and minimize losses. isnt a hedge like a strangle only gonna profit you under 10pct like you all reported even if you are strategic in selling off both sides of the hedge. my other question is are you using limit orders for the hedging because if one side executes and the other does not the potential to get investment wiped out is almost 100pct, correct?I've been paper trading this strategy a couple of month and really inconsistent results but i hold through the ER. what about biopharm catalyst plays using a strangle or straddle, much more volatilie. however im still getting inconsistent results on profit paper trading those as well.
     
    #22     Feb 19, 2017