Assuming I am going to make an earnings play: specifically a one-day Iron Condor for DKS overnight tonight, when should I time my entry? I assume some stuff can go down today and I should maybe wait until late in the day. I'm going shortest duration (4 DTE), slight bullish skew. Likely short strikes ~ 30,37. Earnings on this underlying are announced before open tomorrow. I am curious about timing entry and exit from those who maybe are not in the "don't trade earnings" camp. Thanks- -Kev
>> Assuming I am going to make an earnings play: specifically a one-day Iron Condor for DKS overnight tonight, when should I time my entry? Two days ago, like I did mine.
Please be aware that holding any position through earnings has huge risks. Even if backtesting shows good results, you should always assume a 100% loss and position size accordingly.
sounds fun! I am adjusting/closing/finalizing all other positions to avoid earnings and took this into account before they were opened. My questions was more specific to an earnings-only play. Thanks -Kev
Due to the better pricing you received at that time? The stock has moved one point since that time. Thanks, -Kev
Another possibility is to wait for the earnings report and evaluate the quality the earnings, revenues, company current competitive position, etc and think like an institution who has a long term horizon because of the amount of money they have to invest. Having a sense of how an large institution may look at a company can give you a good clue on whether to fade the move or to determine if the move may have some legs. Besides, you may get better option pricing for a long option position after the earnings release.
Since you want to take advantage of the option IV crush due to earnings the best time to enter is just before earnings at market close - around 3:30pm EST. In your case that would be today. Your option selections depends on the price of the underlining and your expected move after earnings.