Canadian Solar Inc. (CSIQ)
Update 6/6/2017: CSIQ opened low after earnings were published and then rose back to near the prior day’s close, with falling volatility allowing me to exit near my target, at 24.8% of maximum potential profit.
Shares showed a net rise during the day I held the position of 0.1%, or a +43% annual rate. The options position produced a +33.0% yield on debit for a +12,028% annual rate.
CSIQ publishes earnings on Tuesday before the opening bell.
I shall use options that trade for the last time 11 days hence, on June 16.
Implied volatility stands at 59%, which is six times the VIX, a measure of the volatility of the S&P 500 index.
CSIQ’s IV stands in the 26th percentile of its annual range and the 77th percentile of its most recent broad movement.
The price used for analysis was $12.72.
The premium is 49% of the width of the position’s wings.
The risk/reward ratio is 1.1:1.
Decision for My Account
I have entered an order on CSIQ as described above. The stock at the time of entry was priced at $12.72.
By Tim Bovee, Portland, Oregon, June 5, 2017