October 24, 2016  Trade Alert #2 -  Earnings Eagle  Portfolio

Mastercard (MA) announces earnings before the open on Friday, October 28.  They have a record of exceeding expectations most of the time, and the average post-earnings change has been 2.1% which would place it somewhere between $100 and $105 from its present $103.20.  These trades should be profitable if it ends up in that range.  IV for the 28Oct16 series is 36 compared to only 20 for the 02Dec16 and 16Dec16 series:

 

BTO 5 MA 02Dec16 103 calls (MA161202C103)

STO 5 MA 28Oct16 103 calls (MA161028C103) for a debit of $.99  (buying a calendar)  

 

BTO 5 MA 02Dec16 104 calls (MA161202C104)

STO 5 MA 28Oct16 104 calls (MA161028C104) for a debit of $.98  (buying a calendar)

 

BTO 5 MA 16Dec16 105 calls (MA161216C105)

STO 5 MA 28Oct16 105 calls (MA161028C105) for a debit of $1.22  (buying a calendar)  

 

Be prepared to change these price limits by $.05 or more in order to get an execution.

 
Happy trading.

 

Terry