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Earning Season Plays are Here! (Inverted Fly season)

October 11, 2014

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An example of a trade in the Scouting Report.

One of my favorite strategies for playing the big movers during earning season is the INVERTED Butterfly.

I just posted a few in the new scouting report.

If you are new to this strategy, here is an example of one to practice with until you get better at them.

Its a spread you sell that expires soon after the event. You can hold it thru the event if you want or exit anytime you are profitable.

BUT, after the event like te earnings gap, if you are not profitable exit….yes before expiry because the vola drop after the event can hurt you if you dont get a move.

CMG – EARNINGS PLAY SELL ATM PUT INVERTED BUTTERFLY FLY –

SELL Oct4 650/655/660 – Get at least .35 cent credit per contract. Try and close for .05 cents or let expire if way OTM. If its in the money its better to close than take the assignment fees.

CMG inv Put fly

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