Investors beware: Hunting season

Earnings season is here.

Earnings is like hunting season. 

Lots of animals running around. 

How does hunters catch prey anyway?

1. Set traps for the animal to run into

2. Shoot when the animal is resting/immobile 

Let's translation it into investing:

How to hunt stocks during earnings?

[Thinking] ever see hunters carry their Big guns and chasing after animals? 

Somehow, I can't picture that Image.

But when we buy stocks to anticipate earnings. We are doing exactly that. 

We are chasing the animal in a single direction, and Hope to somehow hit it. We may getlucky and hit the animal. But guess it's exhausting and unreliable. The animal can alwaysturn around and change direction. 

Stocks are extremely volatile during earnings, and go all over the place. It's tough to anticipate. Directional options strategy have thesame problem. 

How about we set traps all around the animal Instead? [Thinking] do we have the moneyto put so many traps for 100% chance of success? It may cost even more than buying the animal directly from open market.

Let's translate this into stock context:

There are non directional strategies that we can use. Option Strategies like straddles and strangles, are non directional and cover both positions. in a sense, trapping and cornering the animal. But there's still a problem, straddles and strangles are expensive to execute. The returns may not cover the costs. 

[Sweats] somehow seems to have no easy way to hunt the animal.

Still seems to be the easiest to hunt the animal when it's not moving.

In short, avoid earnings season especially if we do not have sound strategy to catch the animals. May end up either wasting resources or wasting time. 

In general, it's better and safer to hunt stocks when the prices are more stable And we have better clarity to take a clear shot. 

Happy hunting to all

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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  • OSJ
    ·2022-04-15
    if u dont stay invested, what do u do with your cash? Let it rot?
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    • BontaReplying toBonta
      When warren buffet starts to move more and more, it sort of signals a change towards value stock.
      2022-04-15
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    • Bonta
      Partly due to changing macro environment. Easy money once no more, growth stocks wont grow as much. And a lot of movement in last 2-3 years was due to easy money
      2022-04-15
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    • Bonta
      Many of the “strategies” to invest during earnings sounds good on paper. Actual execution isnt that consistent and profitable
      2022-04-15
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  • Sing Options
    ·2022-04-14
    better to have protection also, else the hunter may become hunted.
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    • Bonta
      Thats very true
      2022-04-14
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  • FranklinMorley
    ·2022-04-14
    Thanks to the author's warning, the scene you described makes me a little worried. Which stocks are the most dangerous?
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    • Bonta
      [Thinking] earnings season is tough to say. U may see turtles run like hares. And tiger becoming like sheep. In general, its safer to enter after earnings season
      2022-04-14
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  • zinglee
    ·2022-04-14
    What's your plan to Chinese tech stocks?
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    • Bonta
      DCA for those that have high conviction.
      2022-04-14
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  • prestomanik
    ·2022-04-14
    buy the dip ay
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  • trader1216
    ·2022-04-15
    Dca all the way
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  • muahaha18
    ·2022-04-15
    Its important to be careful
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  • RKT
    ·2022-04-15
    I bieve this is still not hunting but waiting season for big catch to arrive in shooting range.
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  • 嘛嘛财商FQ
    ·2022-04-15
    [财迷] [财迷] [财迷] [财迷] [财迷]
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  • Kellylohlim
    ·2022-04-15
    this is good stuff
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  • Tigercub
    ·2022-04-14
    Good friday. Take a break for the week. Happy lWE people.
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  • yong168
    ·2022-04-14
    [惊讶] [贱笑]
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  • Nagoken
    ·2022-04-14
    Well said
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  • Svengers19
    ·2022-04-15
    Thanks for sharing
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  • octa8
    ·2022-04-15
    Great ariticle, would you like to share it?
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  • DivHolder
    ·2022-04-15
    [Happy] [Happy]
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  • Pimple933
    ·2022-04-14
    earnings session is volatile, good for options.
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  • LeilaLynch
    ·2022-04-14
    I very much agree with the author's point of view that human beings have the mentality of conformity, and many investors will follow the trend.
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    • cuteypie
      OK
      2022-04-14
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  • littlesweetie
    ·2022-04-14
    At a time when the market is full of uncertainty, we should indeed invest cautiously, for the cumulative effect is likely to lead to adverse consequences.
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  • Humbly
    ·2022-04-15
    As stock volatility increases during earnings season,there may be possibility of earning extra income by playing on this rise in volatility which causes option price to increase
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