Day: 2 | Missed Days: 0 | Trades: 2 | Wins: 0 | Losers: 1 | Washes: 1 | Day: (720) | Cumulative: (720)
Hints from today: For a stock which just IPO'd, check the history of similar stocks and how they performed upon IPO and their first earnings release. Also check the option chain to see which way people are betting, to confirm placing a "directional" bet
-Also, remember to first check how much greater the implied volatility on front week options is
Strategy Idea: Maybe try a strategy where we're selling a put spread, and buying a call, since gainers rise more than losers fall
Changes: In order to streamline operations, and since I'm not using the info, I stopped calculating the max drop over the previous 7 earnings announcements unless there's a really big one apparent on the charts.
New Initiative: Try straddles and other trades on stocks Lizards don't work on
________________________________________________________________________________Get in before close 5/10/17:
CTRP earnings 5/10/17 after...get in 5/10/17 Straddle: $3.21
FOXA earnings 5/10/17 after...get in 5/10/17 D: 26%, GOD! Straddle: $1.20, bought straddle
NTES earnings 5/10/17 after...get in 5/10/17 Straddle:$16
SYMC earnings 5/10/17 after...get in 5/10/17 Straddle: $1.67
TEVA earnings on 5/11/17 before...get in 5/10/17 Straddle: $1.76
SNAP earnings on 5/1017 after...get in 5/10/17, Straddle: $2.95.
M earnings before market: 2.25 straddle price...decided not to do it, can go back and look at saved trades though to see result, price was 29.5...I actually decided to just buy an ATM straddle, seems like there wasn't enough premium to justify the risk. So this will be my first straddle play haha, I'll trying buying straddles on stocks I feel don't meet the requirements for this trade, will just try a bunch of stuff I guess.
SNAP: ...snap is tricky since I read an article about stocks which have recently IPO'd..Facebook and Twitter, Facebook lost 11% after first earnings release, twitter lost 44% apparently
...so caution suggest not trading this. Or trading to the reverse...sell the call on the upside...gulp. Max gain, 1100, Max loss, 5900 (remember, this isn't supposed to get hit). No penalty if stock falls excessively to the downside!
---Also in the case of snap, there is a huge call position of 23K calls at the $24.5 price..
--The biggest put position is 7K in comparison, but there are large put positions at a variety of strikes compared to the calls, which are essentially distributed all at one price. Someone could either have sold a ton of these to the market maker or bought a ton...MORE DATA: 43% of the calls for this expiration (which is 2 days away) were traded at the bid or below, since the ask is where sellers are willing to sell, and the bid is where buyers are willing to buy, it seems as if someone is selling to the market maker. This therefore reinforces the thesis that SNAP will decline just as Twitter and Facebook have. Likewise, 52% of puts were traded at ask or above.
CTRP: 1K profit, 4K max loss put side, neutral on the call side. 44% of calls were traded at the ask today, 44% of puts (not a typo) were traded at bid, this suggests people are selling puts and buying calls, suggesting that it will rise if it goes anywhere, this is in line with our trade.
FOXA: Poor liquidity, due to strike widths, can't get the trade neutral on the call side. Nixed.
NTES: Calls and Puts are being bought/sold in the middle. No directional bias can be gleaned from this data. Strategy checks, with a $900 max gain and $5,100K max loss
SYMC: Had to move in a bit closer than the straddle to get it to work, $1 instead of $1.6. Chart clean,earnings date checks, 5K loss, 960 gain,
TEVA: yes, volatility is double, chart looks ok, earnings date is correct, 49% of calls traded at ask or above (big call buyers)...can't trade this one either, $28 stock, .5 opt ions prices and low premiums don't allow, it doesn't really move during earnings anyhow.
WFM: I looked at whole foods...the chart is just exploding relative to the last 2 years. This is not an explosive business, I decided that if anything there'd be negative earnings surprise. Constructed a trade to take advantage of this potentiality...kindof a weird trade, the current profile is sortof like synthetic stock, anyhow. There's gotta be a better way to do this.
SNAP earnings on 5/1017 after...get in 5/10/17, Straddle: $2.95.
M earnings before market: 2.25 straddle price...decided not to do it, can go back and look at saved trades though to see result, price was 29.5...I actually decided to just buy an ATM straddle, seems like there wasn't enough premium to justify the risk. So this will be my first straddle play haha, I'll trying buying straddles on stocks I feel don't meet the requirements for this trade, will just try a bunch of stuff I guess.
SNAP: ...snap is tricky since I read an article about stocks which have recently IPO'd..Facebook and Twitter, Facebook lost 11% after first earnings release, twitter lost 44% apparently
...so caution suggest not trading this. Or trading to the reverse...sell the call on the upside...gulp. Max gain, 1100, Max loss, 5900 (remember, this isn't supposed to get hit). No penalty if stock falls excessively to the downside!
---Also in the case of snap, there is a huge call position of 23K calls at the $24.5 price..
--The biggest put position is 7K in comparison, but there are large put positions at a variety of strikes compared to the calls, which are essentially distributed all at one price. Someone could either have sold a ton of these to the market maker or bought a ton...MORE DATA: 43% of the calls for this expiration (which is 2 days away) were traded at the bid or below, since the ask is where sellers are willing to sell, and the bid is where buyers are willing to buy, it seems as if someone is selling to the market maker. This therefore reinforces the thesis that SNAP will decline just as Twitter and Facebook have. Likewise, 52% of puts were traded at ask or above.
CTRP: 1K profit, 4K max loss put side, neutral on the call side. 44% of calls were traded at the ask today, 44% of puts (not a typo) were traded at bid, this suggests people are selling puts and buying calls, suggesting that it will rise if it goes anywhere, this is in line with our trade.
FOXA: Poor liquidity, due to strike widths, can't get the trade neutral on the call side. Nixed.
NTES: Calls and Puts are being bought/sold in the middle. No directional bias can be gleaned from this data. Strategy checks, with a $900 max gain and $5,100K max loss
SYMC: Had to move in a bit closer than the straddle to get it to work, $1 instead of $1.6. Chart clean,earnings date checks, 5K loss, 960 gain,
TEVA: yes, volatility is double, chart looks ok, earnings date is correct, 49% of calls traded at ask or above (big call buyers)...can't trade this one either, $28 stock, .5 opt ions prices and low premiums don't allow, it doesn't really move during earnings anyhow.
WFM: I looked at whole foods...the chart is just exploding relative to the last 2 years. This is not an explosive business, I decided that if anything there'd be negative earnings surprise. Constructed a trade to take advantage of this potentiality...kindof a weird trade, the current profile is sortof like synthetic stock, anyhow. There's gotta be a better way to do this.
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