THE WEEK AHEAD: DKNG, BYND, LYFT EARNINGS; XOP, GDXJ, SLV, QQQ
EARNINGS ANNOUNCEMENT VOLATILITY CONTRACTION PLAYS:
WKHS (18/146/38.8%),* Monday, before market open.
PLUG (32/100/25.6%), Monday, before market open.
DKNG (32/89/23.6%), Friday, before market open.
CGC (39/132/23.5%), Monday, before market open.
BYND (32/77/18.9%), Monday, after market close.
LYFT (16/71/18.0%), Tuesday after market close.
Pictured here is a BYND December 18th 130/200 short strangle that was paying 7.95 at the mid price as of Friday close, with the short legs camped out at the 18 delta. This yields at or greater than two times expected move break evens and a delta/theta metric of -.58/23.86.
Alternative Defined Risk Setup: BYND December 18th 125/130/200/205 iron condor, paying 1.59 at the mid price as of Friday close with break evens at the expected move on the put side/greater than 2 x the expected on the call and delta/theta metrics of .96/2.45.
Unfortunately, WKHS, PLUG, and CGC all announce on Monday before the open, so any play would've been best put on before the end of Friday's session, although they could still be playable after they make their earnings announcement move.
LYFT: Short straddle or iron fly.
DKNH: Short strangle or iron condor.
EXCHANGE-TRADED FUNDS RANKED BY PERCENTAGE OF STOCK PRICE THE DECEMBER AT-THE-MONEY SHORT STRADDLE IS PAYING:
XOP (14/53/14.1%)
USO (9/57/13.4%)
GDXJ (16/47/12.9%)
SLV (38/50/12.7%)
GDX (16/39/10.9%)
EWZ (17/41/10.7%)
XLE (25/41/10.6%)
BROAD MARKET RANKED BY PERCENTAGE OF STOCK PRICE THE DECEMBER AT-THE-MONEY SHORT STRADDLE IS PAYING:
QQQ (25/30/7.2%)
IWM (24/29/7.2%)
SPY (19/24/6.0%)
EFA (21/21/5.3%)
IRA DIVIDEND EARNERS RANKED BY PERCENTAGE OF STOCK PRICE THE DECEMBER AT-THE-MONEY SHORT STRADDLE IS PAYING:
SLV (38/50/12.7%)**
EWZ (17/41/10.7%)
XLE (25/41/10.6%)
KRE (22/39/10.5%)
* -- The first metric is the implied volatility rank or percentile (i.e., where 30-day implied volatility is relative to where it's been over the past 52 weeks); the second, 30-day implied volatility as of Friday close; and the third, what the December at-the-money short straddle is paying as a percentage of stock price.
** -- Neither SLV nor GLD pay a dividend.
WKHS (18/146/38.8%),* Monday, before market open.
PLUG (32/100/25.6%), Monday, before market open.
DKNG (32/89/23.6%), Friday, before market open.
CGC (39/132/23.5%), Monday, before market open.
BYND (32/77/18.9%), Monday, after market close.
LYFT (16/71/18.0%), Tuesday after market close.
Pictured here is a BYND December 18th 130/200 short strangle that was paying 7.95 at the mid price as of Friday close, with the short legs camped out at the 18 delta. This yields at or greater than two times expected move break evens and a delta/theta metric of -.58/23.86.
Alternative Defined Risk Setup: BYND December 18th 125/130/200/205 iron condor, paying 1.59 at the mid price as of Friday close with break evens at the expected move on the put side/greater than 2 x the expected on the call and delta/theta metrics of .96/2.45.
Unfortunately, WKHS, PLUG, and CGC all announce on Monday before the open, so any play would've been best put on before the end of Friday's session, although they could still be playable after they make their earnings announcement move.
LYFT: Short straddle or iron fly.
DKNH: Short strangle or iron condor.
EXCHANGE-TRADED FUNDS RANKED BY PERCENTAGE OF STOCK PRICE THE DECEMBER AT-THE-MONEY SHORT STRADDLE IS PAYING:
XOP (14/53/14.1%)
USO (9/57/13.4%)
GDXJ (16/47/12.9%)
SLV (38/50/12.7%)
GDX (16/39/10.9%)
EWZ (17/41/10.7%)
XLE (25/41/10.6%)
BROAD MARKET RANKED BY PERCENTAGE OF STOCK PRICE THE DECEMBER AT-THE-MONEY SHORT STRADDLE IS PAYING:
QQQ (25/30/7.2%)
IWM (24/29/7.2%)
SPY (19/24/6.0%)
EFA (21/21/5.3%)
IRA DIVIDEND EARNERS RANKED BY PERCENTAGE OF STOCK PRICE THE DECEMBER AT-THE-MONEY SHORT STRADDLE IS PAYING:
SLV (38/50/12.7%)**
EWZ (17/41/10.7%)
XLE (25/41/10.6%)
KRE (22/39/10.5%)
* -- The first metric is the implied volatility rank or percentile (i.e., where 30-day implied volatility is relative to where it's been over the past 52 weeks); the second, 30-day implied volatility as of Friday close; and the third, what the December at-the-money short straddle is paying as a percentage of stock price.
** -- Neither SLV nor GLD pay a dividend.