8/16 – 2 p.m. New York time

I’m done early today. Here are the outcomes.

I entered three new positions, all corresponding with earnings announcements: CSCO, NTAP and WMT. I exited one position: TGT .

Read More »

Target Corp. (TGT)

Update 8/16/2017: TGT’s earnings came in a $1.23, slightly below the $1.28 consensus expectation by analysts. The share price whipsawed in pre-open trading but immediately after the opening bell was close to where it had closed the day before. I exited with the share price at $55.57 and the options position at a debit of $1.97, or 24.8% of maximum potential profit.

Shares rose by a net 0.5% over my one-day holding period, or a +172% annual rate. The options position produced a +32.1% return for a +12,043% annual rate.

Zacks Investment Research had given TGT an earnings surprise predictor of zero, suggesting a small move that would be more likely to stay within the profit zone, and that’s how it played out.

---

TGT publishes earnings on Wednesday before the opening bell.

I shall use options that trade for the last time 10 days hence, on Aug. 25.

Implied volatility stands at 30%, which is 2.5 times the VIX, a measure of the volatility of the S&P 500 index.

TGT’s IV stands in the 83rd percentile of its annual range and the 78th percentile of its most recent broad movement.

Read More »

8/15 – 3:05 p.m. New York time

OutcomesI I entered a position in TGT and exited one in  HD.

After posting I edited the TGT analysis to include a rule of thumb on expected movement.

It’s calculated this way:  Take the price of a front-week at-the-money straddle (an iron fly without the wings) and multiply it by 0.85. The result is the expected move. By front week I mean the next options series closest to expiration. It almost certainly will differ from the series I’m trading.

I compare the expected move with the break-even points, the goal being to have break-even points that are wider than the expected move.

8/15 – 9:35 a.m. New York time

I have exited HD for a profit.

Read More »

The Home Depot Inc. (HD)

Update 8/15/2017: HD’s earnings came in about where expected, at $2.24 per share, compared to the consensus forecast of $2.25. Shares fell about $1 in the first five minutes of trading after earnings were published. i exited at 26.8% of maximum potential profit.

Shares rose by 0.1% over my one-day holding period, or a +21% annual rate. The options position produced a +36.6% return for a +13,349% annual rate.

I chose to enter HD in part because Zacks Investment Research‘s earnings surprise predictor was 0.45%, narrow there than the -2% to 2% range that I’m allowing in my screening. The indicator proved to be a good predictor of  the outcome.

---

HD publishes earnings on Tuesday before the opening bell. 

I shall use options that trade for the last time 11 days hence, on Aug. 25.

Implied volatility stands at 22%, which is 1.8 times the VIX, a measure of the volatility of the S&P 500 index.

HD’s IV stands in the 66th percentile of its annual range and the 75th percentile of its most recent broad movement.

Read More »

8/14 – 3:25 p.m. New York time

And the day’s work’s is pretty much done. I entered a position on HD and exited JD plus  my positions expiring at the end of the week: FOSL, HTZ, KORS, KSS, SNAP and CBI.

I have updated with results all of the exits except HTZ, and that final one will be completed before the closing bell.

Read More »

Retail sales on Tuesday and housing starts on Wednesday, each published at 8:30 a.m. New York time, and industrial production on Thursday at 9:15 a.m. provide the new economic data through which the markets will swim during the week.

The Federal Open Market Committee minutes of the July 26 meeting, which which the committee voted without dissent to keep the federal funds rate unchanged, will be released on Wednesday at 2 p.m.

Read More »

Canadian Solar Inc. (CSIQ)

CSIQ publishes earnings on Monday before the opening bell.

I shall use options that trade for the last time 14 days hence, on Aug. 25.

Implied volatility stands at 67%, which is 4.3 times the VIX, a measure of the volatility of the S&P 500 index.

CSIQ’s IV stands in the 55th percentile of its annual range and at the peak of its most recent broad movement.

Read More »

JD.com Inc. (JD)

Update 8/14/2017: JD’s earnings came short of meeting expectations: The consensus estimate was $0.11 per share; the actual was $0.10. Shares declined by $3 and then rose by $3.50, and then fell to tracing out an intra-day triangle. I exited for a profit at my target, at 24.9% of maximum potential profit, with shares at $44.75, and the options position cost a $2.80 debit to buy back.

Shares declined by a net 1.6% over my three-day holding period, or a -198% annual rate. The options position produced a 33.2% yield on debit for a +4,041% annual rate.

---

JD publishes earnings on Monday before the opening bell.

I shall use options that trade for the last time 14 days hence, on Aug. 25.

Implied volatility stands at 48%, which is 3.2 times the VIX, a measure of the volatility of the S&P 500 index.

JD’s IV stands in the 93rd percentile of its annual range and the 95th percentile of its most recent broad movement.

Read More »

8/11 – 3:20 p.m. New York time

I entered one new position today, JD, and exited none. I analyzed CSIQ but declined to take the trade.

Read More »

Nordstron Imc. (JWN)

JWN publishes earnings on Thursday after the closing bell.

I shall use options that trade for the last time eight days hence, on Aug. 18.

Implied volatility stands at 48%, which is 3.5 times the VIX, a measure of the volatility of the S&P 500 index.

JWN’s IV stands in the 72nd percentile of its annual range and at the peak of its most recent broad movement.

Read More »