Trading on corporate earnings news : profiting from targeted, short-term options positions

Format:

Book

Author/Creator:

Shon, John, Author.

Contributor:

Zhou, Ping, Contributor.

Language:

English

Subjects (All):

Speculation.

Corporate profits.

Price-earnings ratio.

Investment analysis.

Physical Description:

1 online resource (xviii, 205 p.) : ill.

Edition:

1st edition

Place of Publication:

[Place of publication not identified] FT Press 2011

Language Note:

English

System Details:

text file

Summary:

Profit from earnings announcements, by taking targeted, short-term option positions explicitly timed to exploit them! Based on rigorous research and huge data sets, this book identifies the specific earnings-announcement trades most likely to yield profits, and teaches how to make these trades—in plain English, with real examples! Trading on Corporate Earnings News is the first practical, hands-on guide to profiting from earnings announcements. Writing for investors and traders at all experience levels, the authors show how to take targeted, short-term option positions that are explicitly timed to exploit the information in companies’ quarterly earnings announcements. They first present powerful findings of cutting-edge studies that have examined market reactions to quarterly earnings announcements, regularities of earnings surprises, and option trading around corporate events. Drawing on enormous data sets, they identify the types of earnings-announcement trades most likely to yield profits, based on the predictable impacts of variables such as firm size, visibility, past performance, analyst coverage, forecast dispersion, volatility, and the impact of restructurings and acquisitions. Next, they provide real examples of individual stocks–and, in some cases, conduct large sample tests–to guide investors in taking advantage of these documented regularities. Finally, they discuss crucial nuances and pitfalls that can powerfully impact performance.

Contents:

Introduction

Earnings announcements: why are they so important?

Earnings surprises: definition and measurement

Earnings surprises: empirical evidence

Market reactions to earnings announcements

Market reactions to earnings surprises (are full of surprises)

General characteristics of optioned companies and options behavior around earnings announcements

Practical considerations before implementing trades

Directional bets: long calls, bull call spreads, long puts, and bear put spreads

Long straddle and strangle strategies

Short straddle and strangle strategies

Growth expectations and the torpedo effect

Revenue and expense surprises

Earnings surprise persistence

Other theories and evidence.

Notes:

Bibliographic Level Mode of Issuance: Monograph

Includes bibliographical references and index.

OCLC:

733750224