NaughtyPines

AVGO EARNINGS PLAY

NASDAQ:AVGO   BROADCOM LTD
AVGO             announces earnings tomorrow before market close, and it looks to be a juicy one. Although its IV rank is 56, this underlying is volatile, with an IV currently at 70.

Because I have the buying power available, I am going to go short strangle, but wider than usual to hopefully avoid a debacle at the end of earnings season. It's gone pretty good this season with only three problem children (YUM, IBM             , and HD             ), and I'd like to keep it that way going into the next while I work those three out.

Here's the basic setup, which I may tweak during the day depending on how price moves intraday:

Dec             11 115/150 short strangle
POP%: 79%
Max Profit: $175/contract
BPE: ~$1328/contract
BE's: 113.25/151.75
NaughtyPines
a year ago
Filled for 1.60.
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NaughtyPines
a year ago
Glad I went wide ... . Up 11.38 in AH's market ... .
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NaughtyPines
a year ago
Out of the put side for .05 debit. I'll take off the call side for 50% max of what that side's worth.
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NaughtyPines
a year ago
Price is dancing around just .50 below my short call with 4 DTE; rolling out and up to the Dec 18 expiration, the 152.5 short call strike for an additional .23 credit.
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NaughtyPines
a year ago
Out of the rolled Dec 18 152.5 for a small profit.
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