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Posted (edited)

For the last 4 cycles, straddles for KKD have paid off thru earnings.  I played this last cycle with a small allocation, and closed just after opening for a 24% gain, and if I held on to it near closing I could have gotten over 60%.

 

What do you think? 

Edited by Chuck451
Posted

For the last 4 cycles, straddles for KKD have paid off thru earnings.  I played this last cycle with a small allocation, and closed just after opening for a 24% gain, and if I held on to it near closing I could have gotten over 60%.

 

What do you think? 

 

Chuck,

On the last earnings date (Dec 2), KKD dropped 16% in after hours trading after reporting earnings, and it closed down 20% at the end of the day.  This is a huge move and larger than the 12.5% implied move.  Was this really profitable?  Can you tell us more about the trade?

 

Kim,

Why do you think this looks good?

Posted

To tie this up, I closed this about 11:00 yesterday at 1.15 for a 50% loss.  The price was up 10% after hours, and I was hopefully this was going to be a big win.  Unfortunately, the market had other ideas the next day...  :(

 

I had played ULTA the last cycle with a straddle through earnings for a 65% gain, but skipped it this time.  Glad I did.

Posted

To tie this up, I closed this about 11:00 yesterday at 1.15 for a 50% loss.  The price was up 10% after hours, and I was hopefully this was going to be a big win.  Unfortunately, the market had other ideas the next day...  :(

What you can do in those cases is short the stock in AC to lock the gains (100 shares for each straddle you had).

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