By: Steve Smith
I’m incredibly excited for the upcoming season of my Earnings360 Service. We’re now heading into my 15th consecutive quarter running the program. Yesterday, I hosted a webinar explaining my unique approach to trading earnings.
I do think that you’ll find that my options-centric approach brings a new level of market analysis, options expertise, and accessibility — as its generated consistent gains for over 14 quarters. Earnings360 executes an average of 30 trades per quarter (3-4 per week) with just $350 per trade. This makes it active but also ensures that no single trade results in an outsized loss. While we had one losing quarter of $560, Earnings360 has had an average return of $1,530 per quarter for a total profit of $21,425 over the past 14 quarters (3.5 years).
You read that right, Earnings360 members risking just $350 per trade have raked in a $21,425 profit.
What this service doesn’t do is take wild shots via purchasing out-of-the-money “lottery tickets,” hoping to hit a directional home run.
The Earnings360 approach harnesses predictable changes in implied volatility that come before and after earnings reports; namely the expected decline in implied volatility that occurs after earnings report releases; something I call the “Post Earnings Premium Crush (PEPC)”.
Why Should You Play Earnings?
Most of the time, stock prices are random walks towards parts unknown. Sentiments, fleeting news narratives, and cursory analysis are applied to explain the various ups and downs. However, they’re mostly ascribing reasons after the fact.
However, four times a year, the truth about a company’s profitability, or lack thereof, is revealed, causing stock prices to react immediately and often dramatically. I’m talking about quarterly earnings reports, which provide an unvarnished accounting of companies’ state of business and their immediate prospects.
This quarter should be particularly interesting as companies will be lapping the last year’s shutdown that began in March of 2020. I expect this to lead to very high implied volatility heading into the reports that provide pumped-up premiums for us to harness, using carefully selected strategies such as basic vertical spreads, iron condors, and double diagonals.
However, you shouldn’t worry about being overwhelmed. Each trade recommendation is sent via text and email alerts, explaining the rationale behind employing a specific options strategy. Additionally, I provide exact step-by-step instructions on how you can place the order using defined-price limits. Earnings360 typically sends approximately 25-30 trade recommendations over the course of the six-week program.
This season, which will run from July 12 to August 27, should present us with a plethora of opportunities for large profits in a very short period of time!