It’s a well-known investment maxim that risk is correlated to reward. But when it comes to options it seems people are often making claims to both consistently hitting singles while simultaneously being home run kings.

On Monday, we took a timely dip into a bullish position in oil through a diagonal calendar spread in the SPDR Energy Select (XLE) exchange traded fund. Shares of the Energy ETF jumped some 3% on Tuesday to $80 per share pushing the value of our spread position fully in-the-money and its value from $2.75 to $3.50 in a single day.

Making trades based on an earnings report poses several challenges but can deliver big rewards as the reports tend to cause large price moves. One not only needs to accurately predict what the company’s actual results will be but how these stack up to analyst estimates.