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David Janello's avatar

BTC U 28.50-29.50 Call Vertical @ 0.15 . (0.06) loss

STC U 31.50-32.00 Call Vertical @ 0.75 +0.29 profit

Net Profit = 0.23 Opening Position Cost 0.36 63% return

BTO CRSR 17.50 Put @0.65

STC CRSR 17.50 Put @0.15 (0.50) loss -76% return

CRSR was down 1.39 in the after hours market after earnings, opened the next day unchanged, is currently up 2.09.

Some readers were asking the best way to manage post-earnings closing trades, I recommend doing whatever worked in the recent past.. For example, if you have a string of trades that you closed out too soon, hold onto the position longer next time. My last three earnings trades were FSR (best strategy was to close ASAP, those who held on are looking at close to 100% loss instead of 50%+ gains), CRSR (best strategy was to hold longer on the unhedged vertical spread position, best strategy was close out ASAP on the hedged position with short vertical) and CRSR (best to close out ASAP to capture 0.15 on the put before it went to zero). Options markets are strongly autocorrelated (current volatility is influenced by recent past volatility), so the crude metric of doing whatever worked recently has a strong fundamental basis.

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David Janello's avatar

SELL TO CLOSE VERTICAL FSR 5.5-6.5 2023-05-12 PUT @0.60 +48%

SELL TO CLOSE EQUITY_OPTION FSR 5.5 2023-05-12 PUT @ 0.25 +47%

SELL TO CLOSE EQUITY_OPTION FSR 5.5 2023-05-12 PUT @ 0.3 +76%

SELL TO CLOSE VERTICAL FSR 5.5-6 2023-05-12 PUT @ 0.29 +81%

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