04-12-2020, 06:41 AM
Newest strategy goes in the toolbox on Tuesday when JNJ reports earnings.
Strategy essentials: selling an Iron Condor on lower beta (<1.0) stocks after earnings day closes. Short strikes are 5% above and below closing price. The IV will continue to collapse after earnings come out. No adjustments, hold to expiration unless like 90% of max comes out very quickly for some reason.
Earnings come out on a Mon or Tues, expiration chosen will be that same Fri. W,TH, Fri earnings will use the next Friday expiration.
All stocks will be lower beta, higher prices with weekly options. Risk is only to one side.
Studied it enough, now some real world experience with these.
Strategy essentials: selling an Iron Condor on lower beta (<1.0) stocks after earnings day closes. Short strikes are 5% above and below closing price. The IV will continue to collapse after earnings come out. No adjustments, hold to expiration unless like 90% of max comes out very quickly for some reason.
Earnings come out on a Mon or Tues, expiration chosen will be that same Fri. W,TH, Fri earnings will use the next Friday expiration.
All stocks will be lower beta, higher prices with weekly options. Risk is only to one side.
Studied it enough, now some real world experience with these.