This is an update to the blog posted yesterday Alcoa (AA) - Earnings Preview and Vol Trading Pattern.
AA is trading $11.09 with IV30™ down 8.5%. The LIVEVOL™ Pro Summary is below.
In yesterday's article I noted that:
AA has followed a consistent earnings pattern for four out of the last five earnings starting with the 4-7-2009 cycle and ending with the last earnings cycle on 4-12-2010. Specifically, a straddle sale at the close on the day of earnings and a purchase back the day after was a winner each time.
AA had earnings last night, the Options Tab today (after earnings) is included (click to enlarge).
We can see the ATM straddle is now worth $0.41. Yesterday, the straddle was worth exactly twice that; i.e. $0.82. The one day trade would have turned a 50% profit ex-commissions. The updated earnings and dividends stats are included (click to enlarge).
This is trade analysis, not a recommendation.
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Thanks for showing the trade. I am a newbie to options and am trying to make sense of the analysis here. Great stuff.
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