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Information+Discussion-Trading The Earnings Cycle UsingStraddles-TeslaPlusOtherStocks

Discussion in 'TSLA Investor Discussions' started by MitchJi, Aug 11, 2015.

  1. MitchJi

    MitchJi Active Member

    Joined:
    Jun 1, 2015
    Messages:
    1,900
    Location:
    Marin County, CA
    Hi,

    Brief excerpts from the book "The Volatility Edge In Options Trading" are quoted below:
    http://www.amazon.com/The-Volatility-Edge-Options-Trading/dp/0132354691
    From Chapter 1 of the book, quoted for two reasons. Good examples of things to be careful of when selling calls, plus a clear example of IV and other indicators responding to insider trading:
    Chapter 7 - Trading The Earnings Cycle - Page 205
    (two categories are mentioned, I focus mostly on the first - increasing volatility during the days that precede the ER)
    Chapter 7 - Trading The Earnings Cycle - Pages 222-223
    I have three questions:
    1. How simple or difficult is this to implement (sounds pretty simple)?

    2. Any good candidates in addition to Tesla?

    3. I would consider something like a straddle of (for example 10 calls and puts) and if it is profitable, and either IV is substantially higher (IV responding to insider trading?) keep a few of the corresponding options (paid for from the profits). Seem like a good idea?
     

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