#Earnings Looks like the $RH earnings report resulted in some after hours volatility but only a slight move down so far. Will be closing my 75 short puts today, and also will close a 100 short call that filled near the close for .66.
Tag Archives: Earnings
RH earnings
#Earnings STO $RH Dec 18th 75 puts for .95. Biggest UP move: 16.1% , Biggest DOWN move: -11.9% , Average move: 8.7% . This trade is 13.8% OTM. Keeping position small as I don’t trust the market. May add 105 calls on some strength.
AZO calls closed
#Earnings BTC $AZO Dec 18th 800 calls for 3.85. Sold on Monday as part of 700/800 strangle for 5.25. Order in to close puts for .20.
AZO on fire
#Earnings My plan with the 800 calls will be to roll into January should we breach 800. As it looks more than likely, I may close today if price settles down from here.
AZO earnings
#Earnings STO $AZO Dec 18th 700 puts for 2.95 and 800 calls for 2.30. Over last 12 earnings, (one day moves) Biggest UP move: 4.6% , Biggest DOWN move: -4.0% , Average move: 2.3% . 13-day moves: Biggest UP move: 6.5% , Biggest DOWN move: -5.4% . These strikes are 6.9% and 6.5% OTM respectively.
VLO covered put
STO $VLO Dec 31st 66 put for .85, against short stock.
AMBA earnings
#Earnings BTC $AMBA Dec 4th 54 puts for .15. Sold as part of iron condor yesterday for .85. Took this off near the open; now can be left to expire or taken off more cheaply.
VLO covered puts
#Earnings #CoveredPuts STO $VLO Dec 24th 67 covered put for .85. I am short the stock, cost basis around 67.
AMBA earnings
#Earnings This one has had a big move down, so I’m playing it safe with a condor rather than naked. Short strikes are within its historical moves, but it has only has 11 quarters since IPO and the recent move down could mean a record move.
STO $AMBA Dec 4th 52/54/66/68 iron condors for .85. Biggest UP move: 8.6% , Biggest DOWN move: -8.5% , Average move: 4.4% . Short strikes are 10% OTM.
AVGO earnings
#Earnings BTC $AVGO Dec 4th 120 puts for .05. Sold yesterday for 1.00.
Short options, Margin, and retirement accounts
I got this question over the weekend:
Question:
What type of account are you trading in when you short naked? Regular margin/Portfolio margin account? Trying to find out what the more experienced folks setup when the run the types of strategies you use and not get killed on the tax side, but have all the strategies open to me unlike an IRA style acct.
Answer:
I use two different account types. My main account is an LLC account with portfolio margin… it is set up as a business partnership with family members. There are no restrictions on the types of trades. I also trade with 401K accounts… these are retirement accounts sponsored by the LLC for the members of the LLC (who are technically employees). Each member, including myself, rolled over portions of IRA accounts into these 401K’s. At Interactive Brokers, 401K accounts do not have restrictions against naked options. They are Reg-T accounts, so margin requirements for shorts are higher than portfolio margin. I typically sell naked options in my LLC account and stick to spreads in the 401K accounts (almost exclusively the #SPXcampaign, which is tailor made for retirement accounts).
For the short strategies such as #Earnings and #ContangoETFs, you will need to use spreads if you want to trade in an IRA. I usually don’t use spreads, but some other contributors on OptionsBistro do, such as @fuzzballl, who uses a mix of naked and spreads.
Let me know if I can help further!
Expirations…
#OptionsExpiration
Expiring with max profit:
$SPX 1920/1895 put spreads
$SPX 1965/1940 put spreads
$VLO 65 & 66 puts
Assignment:
$NXPI 83 & 84 covered calls, stock called away
Have a great weekend everyone!
GMEarnings done
#Earnings BTC $GME Nov 27th 34 puts for .05. Sold for .40 on Friday. Closed the calls for .01 yesterday so this completes the trade.
GMEarnings
#Earnings BTC $GME Nov 27th 45 calls for .01. Sold for .40 on Friday. The 34 puts may recover today; order in to close for .05.
Good morning, 11/23/15
Probably a pretty quiet holiday week, which is great for theta decay and one and a half fewer days before weekly expiration this Friday, when markets close early after a full day off. I will be sell Dec 24th credit spreads in the #SPXcampaign. The $GME #Earnings trade looks to be in $2 worth of trouble to start the week… I’ve actually been here before with GME… it usually is a quick trade but one time I took the stock and waited a few weeks with covered calls before turning a good profit. It may take its time to recover but it always has. Have a great week, everyone!
Expirations!
#OptionsExpiration 11/20/15
These expired with max profit:
$BOIL 40 calls
$FL 55 puts
$KOLD 100, 105, 110 puts
$NXPI 75 put
$NXPI 85 covered calls
$UVXY 25 puts
$VLO 67 covered puts
$WSM 57.5/75 strangles
$ZOES 22.5 and 25 puts
$ZSL 63 call
Assignment:
$KOLD 109, 135, 136 calls, stock called away
And this #Earnings one didn’t work…
Long $WMT 55 puts, expiring worthless. Bought for .34 on Monday.
Have a great weekend, all!
GME earnings strangle
#Earnings STO $GME Nov 27th 34/45 strangles for .80 (sides sold separately for .40 each). Over last twelve earnings reports, Biggest FIVE DAY up move: 12.5% , Biggest DOWN move: -14.7% , Average move: 8.2% . So these are the moves you can expect for the 5 days between Monday morning announcement to Friday’s expiration. The trade’s strikes are 12.8% OTM (puts) and 15.4% OTM (calls).
SPLK trade closed
#Earnings BTC $SPLK iron fly Nov 20th 62.50 puts for 1.25… sorry I couldn’t post earlier, but I closed these as stock started dropping. Too bad to have missed early morning exit, but still escaped with decent profit. If you are still holding, either get out when you can or see if there’s an end of day rally. Breakeven on trade will be a few cents under 60.00.
SPLK closed calls
#Earnings #IronButterfly BTC $SPLK 62.5 calls for .30. Now will wait for next bounce to exit short puts cheaply.
SPLK iron fly
#Earnings $SPLK behaving beautifully for the iron fly, heading toward our center strike. Best move would have been to close the short put at the highs, but missed that. Now watching for chance to close both shorts when we can.
NXPI puts
I’m still long this stock from an #Earnings play but selling #CoveredCalls and #ShortPuts against it, bringing cost basis down.
STO $NXPI Dec 4th 75 puts for .80
Good morning, Expiration Friday 11/20…
Bulls are in charge… $VIX should drop below 16.05 today, which was the level from which our last signal fired (11/11 close, from which we spiked 25% last Friday). This is an indication that the 11/13 warning is more likely a false alarm. Given this, I think we can lower the threat level. Next levels to watch on $SPX would be the most recent peak around 2015, then all-time highs at 2034. A break through either could mean the bulls drive us into year-end. Meantime, #Earnings plays in $FL, $ZOES, and $WSM look solid, and $SPLK iron fly will probably maintain at least a small profit.
SPLK earnings trade
#Earnings STO $SPLK 57.5/62.5/67.5 iron butterflys for 3.65. Risking 1.35 to make a max of 3.50 or so. See my earlier post for further explanation.
WSM earnings strangle
#Earnings STO $WSM Nov 20th 57.5/75 strangles for 1.05. Over last 12 earnings, Biggest UP move: 10.3% , Biggest DOWN move: -12.0% , Average move: 6.0% . These strikes are 12.9% and 13.6% OTM respectively.
SPLK iron butterfly
#Earnings Looking at $SPLK, I see the moves on earnings have been under 5% for the last four reports. Before that, it is higher, so I don’t want to sell naked on it. Instead, I’ll take a low risk bet that it will make another small move. An ATM iron butterfly, 5 points wide, is risking 1.5 to make 3.5. I will wait until end of day to put on the trade, in case I need to move to a different strike, but for now the plan is : Sell 1-62.5 put, buy 1-57.5 put / Sell 1-62.5 call, buy 1-67.5 call. Here are the last 12 reports, 1-day moves:
Aug. 27, 2015 AC -2.27%
May 28, 2015 AC -4.85%
Feb. 26, 2015 AC -3.33%
Nov. 20, 2014 AC 3.06%
Aug. 28, 2014 AC 19.07%
May 29, 2014 AC -16.34%
Feb. 27, 2014 AC -2.87%
Nov. 21, 2013 AC 22.80%
Aug. 29, 2013 AC 12.85%
May 30, 2013 AC 3.40%
Feb. 28, 2013 AC 7.86%
Nov. 29, 2012 AC 0.73%
FL earnings trade
#Earnings STO $FL Nov 20th 55 puts for .60. Over last 12 earnings, Biggest UP move: 8.8% , Biggest DOWN move: -7.1% , Average move: 4.2% . This trade is 10.0% OTM.
BBY earnings trade
#Earnings BTC $BBY Nov 20th 27 puts for .06. Sold yesterday for .32 avg price.
Good morning….
Futures were up, but now negative, so perhaps we’ve reached a consolidation area… but be leery of strong moves in either direction as action has been bullish, but a downside warning is still in effect from Friday. (In my backtesting, the correction low of $SPX can be anywhere between 1 day and 1 month after the first warning). I will look to sell Dec 17th put spreads near the open. Meanwhile, we can search for earnings trades in $ADSK, $FL, $GPS, $INTU, $ROST, $SPLK, $WDAY, $WSM. Trade smart!
ZOES earnings trade
#Earnings This one is a bit riskier since it is fairly new with only 6 previous earnings reports. Still, the options are pretty far OTM and lower than the stock has been since its IPO month; stock is cheap if assigned.
PLUS, earnings are after tomorrow’s close, so only entering partial today. Will update tomorrow.
STO $ZOES Nov 20th 25 puts for .50, and 22.5 puts for .25.
Biggest UP move: 7.5% , Biggest DOWN move: -4.6% , Average move: 4.6% . These strikes are 20.5% and 28.4% OTM respectively.
BBY Earnings trade
#Earnings Sold to Open $BBY Nov 20th 27 puts for .30 and .32. Scaling in to full position as stock drops off its highs. Next order is in for .34. Not enough premium in calls to make a strangle.
Over last 12 earnings reports: Biggest UP move: 13.2% , Biggest DOWN move: -13.0% , Average move: 6.9% . This trade is 13.3% OTM.
NXPI covered calls
#Earnings #CoveredCalls STO $NXPI Nov 27th 83 call for .50 and 84 call for .45. (assigned stock at 86.00)
Buying a put calendar in…
Buying a put calendar in GMCR for earnings. Nov./Dec. at the 30 strike for approx. 50 cent debit. Will change it to a put credit spread later if GMCR doesn’t go down to cover the costs of the Dec. put.
WMT bearish trade
#Earnings – this is NOT my normal earnings trade, but with market volatility I do not feel like shorting options on earnings, especially because there isn’t a lot of premium in many of these companies reporting. But much of retail is very bearish, dropping further on earnings. So I bought 3 $WMT Nov 20th puts for .34, a $100 bet that this could crater down toward 50 when it reports tomorrow morning.
NXPI and VLO management
#Earnings… got some movement today in stocks I was assigned through earnings plays.
$VLO, was assigned short shares at 65.00. Been selling puts and calls, raising my cost basis. Today closed some Nov 13th 71 calls for .08, and sold a Nov 27th 65 covered put for .55
$NXPI was assigned long shares at 86.00. Yesterday sold Nov 20th 85 covered call for .95, and today a Nov 20th 75 put for .60. Lowering my cost basis by selling premium.
TDG earnings play
#Earnings Sold to Open $TDG Nov 20th 200 puts for 1.40. Never traded this before, but it is not much of a mover on earnings. Over last 12 quarters:
Biggest UP move: 4.2% Biggest DOWN move: -4.4% Average move: 2.3%
These expire NEXT week, and are 9.5% out-of-the-money. IV should drop by at least 10% tomorrow.
If selling naked options, be sure to use an appropriate position size for your account.
NXPI covered call
#Earnings #CoveredCalls Sold to Open $NXPI Nov 20th 85 call for .95. This is against the stock I was assigned at 86 on an earnings trade.
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