Weekly Options Strategies Around Earnings (Remarkable Potential for This 4 Day Trade in $AAPL)

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We discuss Weekly options strategies in this video. This simple to understand strategy (Calendar Spread) takes advantage of the unique characteristics of options as they approach earnings.

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*SMB Disclosures* https://www.smbtraining.com/blog/smb-disclosures


tj add says:

I recommend Netflix

David Kamnitzer says:


How would you manage this trade if it started to go against you? Where would you put your stop loss?

Kendrick Chan says:

Thanks for your video, which is inspiring. May I ask a further question, what if the short leg becomes ITM and assigned? And can we improve the strategy by trading the OTM pair, will it improve the overall premium efficency comparing to the ATM pair?

Vincent Jean says:

apples for apples 😉

Craig Winter says:

Seth, any thoughts on how to find candidate stocks? I typically use finviz for screening. Thanks.

Y A says:

Anyone tried this approach? how it goes?

Vince C says:

Sorry Seth but this idea ONLY works if the price of Apple stays flat for the 4 days. Look at the option chain prices at the 8:30 mark. If the price for Apple goes up or down more than 5 dollars you will lose money. Even with normal volatility It would be easy to lose most of the $3,090 you put into this trade. This is a high Risk to Reward ratio trade that's not worth taking by ANYONE !!! I'm disappointed in you Seth :>(

m0wn3d says:

Thanks for this intriguing video. I do have one question, though: Why did you use Calls instead of Puts? Or the other way around: When do you use Calls for this and when do you use Puts?

Bevan Clark says:

Do you use double calendars to control delta/gamma risk such as a run up/down of price before earnings?

Contang0 says:

Very much enjoying the options videos, like some of the comments, I too would like to know more about what the scenarios are that could hurt this strategy, and what kind of action would be taken to mitigate that. It's a nice looking idea, but I would imagine not the whole story? posting edges on youtube would lead to those being eroded quickly… i've seen this in markets I trade.

Jeff N says:

Quick question. Why is there such a price discrepancy between the SPX traditional options and the weekly options which both expire tomorrow? It seems like there could be a trade which is too good to be true.

Chuck says:

I like Seth and I took the options class which was good but the hard sell at the end of the class was disgusting

Brian Cox says:

Doesn't this trade run a high risk of assignment since the short options are ITM leading up to expiration? I like the idea, but I wouldn't an ATM Short Iron Butterfly entered the session before earnings provide a higher probability of success because of the post-earnings volatility crush? I've back tested this strategy in several different securities and it seems pretty solid. Thoughts?

B elias says:

This startegy is for stocks that hardly move and have HIGH IV which is rare.If forecast is no move IV is low and calendar won't work.Apple for this report may be didn't move.BTW how about if apple gapped up +15 points?In addition ,the slide shows both LEGs were bought (One is sold).TX for the info.

hightower1215 says:

This trade has substantial risks that were not covered in the video.

Douglas Reynolds says:

ADBE is usually a good candidate for this strategy

cottondai says:

Wow thank you for this lesson. I will apply it right away.

bmwman5 says:

So the Short option loses 64% of its value, that too prior to earnings, but the Long option only loses 8% post-earnings?? Doesn't IV crush come into play here? I would think it would lose more than just 8%, no??

Dan Clark says:

Hmmmm, Seth great info. Today IBM tanked the last hour, NFLX soared in the same time and I didn't see any stocks that stayed in a tight range. How do you locate those? BTW, I think I made a good trade on NFLX this afternoon, will see how the price holds till tomorrow's open. Thanks for the info!

Chris Kenny says:

Is there any scenario on this where you can get killed? I wish we could get worst case scenarios as well.

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