To be Announced or Not to Be?

There are a LOT of things that roil the market. A lot of things that can have both a very positive and a very negative influence on the outcome of your trade.

One of those things is upcoming earnings announcements. Earnings announcements can seriously affect implied volatility.  This is reflective of anticipated price movement related to the announcement.

Maybe you make the trade with the intent of capitalizing upon higher volatility. However, sometimes, if you are not attentive, you could inadvertently make a trade that coincidentally expires on or after an announcement. The result could be either a pleasant surprise or a very unpleasant revelation.

What I’m getting at is always know when an earnings announcement is coming prior to submitting that trade for execution.