Next week will be a big week for tech company earnings, with “Magnificent Seven” members Alphabet (GOOG, GOOGL), Microsoft (MSFT), Amazon (AMZN), Meta (META), and Apple (AAPL) all reporting. I am planning to do so.
Brian Overby, senior options strategist at OptionsPlay, told Yahoo Finance that options trading for profit is “always speculative in nature.” One of the biggest things traders want to establish, he says, is “what is the expected move after the earnings report? And the market will tell you that just by looking at the options contract with the closest term.” said.
Mr. Obee will explain what he will do with Amazon’s (AMZN) position ahead of the October 31st earnings call.
“Amazon is looking for an expected value of about 6.5%, but it’s actually about 12 points. So if I’m setting up a trade that I want to be bullish or bearish, it has nothing to do with whether or not Amazon is going to announce that whether the market goes up or down because the market is looking for that kind of movement after the earnings report. On Thursday, we have one day left on Friday’s options contract, so we’re looking at a long call spread for that expiration date and want to make sure we’re short on that position. Speculative trading on returns should always be approached in such a way as to stay within expected movements. ”
Watch the video above to hear Overby’s thoughts on how the election will affect the CBOE Volatility Index (^VIX) and how you can take advantage of it now.
For more expert insights and analysis on the latest market trends, learn more about Extended Time of Market Domination here.
This post was written by Stephanie Mikulich.
