To The Moon

Earnings season is heating up! Next week, Palantir, AMD and Qualcomm will take their turn in the spotlight.

Can AI businesses sustain their growth? How are chip businesses performing? Will share prices break higher after the results, or pull back as markets reassess expectations?

All three companies plan to report after the US market closes. Dates shown below are US local dates.

Earnings Predictions: Which Company Gets Your Vote?

Earnings growth does not always lead to a higher share price—the key is whether results beat market expectations. Even then, the stock may fall if the good news is already priced in or the company’s outlook disappoints.

Give your prediction a reason:

• My pick: PLTR / AMD / QCOM

• My prediction: Will the stock close higher or lower in the first regular trading session after the results, compared with the closing price in the session before the announcement?

• My reason: Earnings performance, business guidance or market expectations?

From Predicting Price Moves to Understanding Options Strategies

If you are new to options, earnings season offers an opportunity to observe and learn. Beyond choosing a direction, you can explore how different strategies fit your holdings and available funds.

Bullish? Explore These Two Approaches:

• Buy Call: Express a bullish view by buying a call. You pay a premium and could lose the entire amount.

• Cash-Secured Put: If you are willing to buy shares at the strike price and have enough cash set aside, you can learn about selling a put to collect a premium. However, if assigned, you must buy the shares at the strike price and could incur substantial losses if the stock falls sharply.

Bearish, or Expecting Limited Upside? Consider:

• Buy Put: Express a bearish view or help protect an existing holding against downside, in exchange for paying a premium.

• Covered Call: If you own enough shares, expect limited upside and are willing to sell at the strike price, you can explore selling a call against your holding. This generates premium income but caps potential upside and does not eliminate losses if the shares fall.

Getting the Direction Right Does Not Guarantee a Profit.

Options prices also depend on time to expiry, the strike price, and implied volatility. Before earnings, expectations of larger price moves may push options premiums higher. After the announcement, uncertainty may ease and implied volatility may fall, reducing the value of purchased options.

Option sellers must also consider assignment obligations and the relevant cash, shareholding and margin requirements.

Try recording your predictions through paper trading, then observe how share prices and options prices change before and after the results. Once earnings are out, look back: what did you get right, and where did your expectations differ from the outcome? Asking “why”, rather than focusing only on whether your prediction was correct, can help you understand options better.

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