My Favorite Earnings Strategy (And How I’m Using It on NVDA)

Hey traders,

It’s Tuesday, and I’ve got something special lined up for tomorrow.

I’m about to dive into one of my all-time favorite earnings strategies, and I want to give you a sneak peek.

So, here’s the deal: Nvidia (NVDA) is reporting earnings tomorrow after the market closes, and I’m planning to make a move that I’ve used successfully in the past.

The Setup

Nvidia has been on fire, and if their earnings come in strong, the stock is likely to pop in the aftermarket.

Now, I already hold over 7,000 shares of NVDA, but I’m going to add a bit more to my position just for this trade.

Here’s how it works:

  1. Buy Right Before the Close: About five minutes before the market closes tomorrow, I’m going to buy more Nvidia shares. I’ll also buy an at-the-money call option with an expiration date about two weeks to a month out. The specific expiration doesn’t matter too much because I’m planning to sell the option on Thursday morning when the market opens.

  2. Sell in the Aftermarket: If Nvidia’s earnings are strong, the stock should pop in the aftermarket. I’ll sell the shares I bought right before the close into that pop — just 20 minutes after the report comes out. It’s one of the quickest day trades you can make.

  3. Sell the Option the Next Morning: Since there’s no aftermarket session for options, I’ll wait until Thursday morning to sell the call option. If NVDA is up big, those options will be up even bigger.

What If It Doesn’t Work?

Now, I’m betting on NVDA going up, but what if you think the earnings will disappoint? You can flip this strategy on its head:

  1. Short NVDA Right Before the Close: If you think the stock is going to drop, short it before the close.

  2. Buy a Put Option: Along with shorting the stock, buy an at-the-money put option with a strike price close to the current market price.

  3. Sell the Stock in the Aftermarket: If the report is bad and the stock drops, you’ll make a nice profit by selling in the aftermarket.

  4. Sell the Put Option the Next Morning: Just like with the call option, you’ll wait until the next morning to sell the put option for a profit.

My Take

I’m betting on the upside with NVDA. I’ll buy more shares right before the close, sell them in the aftermarket, and then sell the call option the next morning. The last time I did this with NVDA, I made more on the stock than the option, but both worked out well.

This is my go-to earnings strategy, and it’s one that’s worked for me time and time again. If you’re looking to play the earnings game, this is a strategy worth trying.

Trade well,

Jack Carter
P.S. Trading NVDA is great, but earnings only come once a quarter. Want to see how I get a high-probability trade sent to me every single morning? Check out this video I recorded for you.

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