We are officially in the doldrums between earnings seasons. But an opportunity or two can still be found each week. And while the offseason earnings trades oftentimes lack all of the necessities for an actual trade, it’s still worth taking a look at potential trades as we patiently wait for another upcoming earnings season, if only for educational purposes.

Cabot Options Institute – Earnings Trader Issue: May 23, 2022

Welcome to Cabot Options Institute’s Earnings Trader!

Lululemon (LULU) is, in my opinion, the only stock worthy of a look next week, although there are a few others that are certainly worth a glance. LULU is due to announce after the close Thursday. And by the looks of its IV rank 97.62, now is as good a time as ever to sell some premium in the stock.

IV_Rank_COI — *I plan on taking a closer look at a potential LULU trade, including all of the statistics (IV rank, IV %, etc.), in a follow-up update. Stay tuned!

But I don’t want to get too heavy into the nitty-gritty just yet. In today’s issue, we aren’t going to do any heavy lifting. No real market commentary (OK, maybe a little), just an overview of Earnings Trader and what to expect going forward. We will have plenty of time to get into the mechanics behind the strategies.

Today, I simply want to go over the ins and outs of the service so that you can efficiently and effectively take advantage of all the content provided including details on issues, trade alerts, webinars and more.

My suggestion is take your time to read through everything. Get comfortable with the approach, strategies used and write down questions as you go along. Don’t hesitate to send me emails as you go through all of the content. That’s why I’m here. I will also be holding a live weekly webinar every Friday during earnings season. During each webinar we will discuss all things earnings, but mostly focusing on our trades that week, upcoming trades and answering any and all questions you might have, including any trade ideas you would like to go over.

Of course, if you can’t attend, no worries, all of our webinars/videos will be archived on your subscriber page to peruse at your leisure.

Trade when you are ready! Don’t force it. Know prior to every trade how much you stand to lose so that you can position-size accordingly. I often recommend paper trading if you are just starting out. Once you progress and want to trade with “skin in the game,” start small. Learn the importance of position size and what works for you. Be realistic in your expectations. Understand what a winning and losing trade look like and the mechanics of how we react in both cases. You can my approach to risk management and much more in the User Guide and reports below.

I recommend starting with the

User Guide

In the User Guide you will learn what to expect for content and when you will be receiving it. You’ll also learn the basics of my approach including a brief overview of the strategies we use.

Once you have moved through the User Guide, please read the following reports included on your subscription page.

The Foundation of Taking a Statistical Approach to Options Trading
The Importance of Risk Management
The Three Main Options Strategies (Bullish, Bearish, Neutral)

Scouring through the reports will prepare you for what’s to come and will be incredibly helpful once we begin sending out trade alerts. Again, if you have any questions, please do not hesitate to email me at andy@cabotwealth.com.

The Week Ahead

Below you will find the implied volatility (IV), IV rank, IV percentile, average past price movements around earnings, expected move (implied move) and a few other key items to help you with any potential trades.

I use the following list as a guide for any potential earnings season trades. If you have any questions on the information provided below don’t hesitate to email me at andy@cabotwealth.com.

Top Earnings Options Plays

Here are a few other top earnings options plays for next week (5/30 to 6/3):

A Few Trade Ideas for Next Week

I will begin to go through numerous potential trades, step-by-step once we get through the Memorial Day weekend. As I’ve mentioned a few times already, we are in between earnings cycles. Trades will occur in between earnings seasons, but the number will be significantly less than when earnings season is in full swing.

Next Live Analyst Briefing with Q&A

Our first live analyst briefing with Q&A is scheduled for Friday, July 8th at 1:00pm EST and we are going to get right to it. Every Friday during earnings season I will hold a live webinar. In the webinar we will discuss the prior trades of the week, look at potential trades for the upcoming week (including any trades that you wish to discuss) and take any questions you might have. Earnings trades tend to bring lively discussions so I’m looking forward to our first of many. Register here.

Portfolio

No positions.

The next Cabot Options Institute – Earnings Trader issue will be published on June 3, 2022.

About the Analyst

Andy Crowder

Andy Crowder is a professional options trader, researcher and Chief Analyst of Crowder Options. Formerly with Oppenheimer & Co. in New York, Andy has leveraged his investment experience to develop his statistically based options trading strategy which applies probability theory to option valuations in order to execute risk-controlled trades. This proprietary strategy has been refined through two decades of research and real-world experience and has been featured in the Wall Street Journal, Seeking Alpha, and numerous other financial publications. Andy has helped thousands of option traders learn and implement his meticulous rules-driven options trading strategies through highly attended conferences, one-on-one coaching, webinars, and his work as a financial columnist. He currently resides in Bolton Valley, Vermont and when he’s not trading, teaching and writing about options, he enjoys spending time with his wife and two daughters, backcountry skiing, biking, running and enjoying all things outdoors.