Does anyone know a solid option strategy to play volatilty of a stock. I am looking at how implied volatility usually increase significantly on certain stocks as their earnings date approaches. (Some top examples FSLR, SNDK, AMZN... )
I know the basic long straddle or long strangle should work (if the price moves), but I am looking for some other strategies.
Any help would be appreciated.
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Does anyone know a solid option strategy to play volatilty of a stock. I am looking at how implied volatility usually increase significantly on certain stocks as their earnings date approaches. (Some top examples FSLR, SNDK, AMZN... )
I know the basic long straddle or long strangle should work (if the price moves), but I am looking for some other strategies.
You can play outright up or down trends using a call/put option spread (aka bull or bear spread) This is done by buying a call option, and selling a further strike price call option, that expires in the same month. By selling your further strike price option, it reduces your entry price. However in most options trades, commissions become a limiting factor in netting profitable results. Therefore do your due diligence prior to performing one of these trades.
Here is an example: https://www.voptions.com/bullish_strategies_long_stock_ratio_call_spread.htm
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You can play outright up or down trends using a call/put option spread (aka bull or bear spread) This is done by buying a call option, and selling a further strike price call option, that expires in the same month. By selling your further strike price option, it reduces your entry price. However in most options trades, commissions become a limiting factor in netting profitable results. Therefore do your due diligence prior to performing one of these trades.
Here is an example: https://www.voptions.com/bullish_strategies_long_stock_ratio_call_spread.htm
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