Unofficial Trade

Unofficial Trade

Hello Smart Option Sellers! Dollar General (DG) As mentioned yesterday, I was going to be offering up an unofficial earnings play today for those of you who may be interested. Earlier, I had outlined what it would take to make a potentially successful earnings play - the need to find stocks which have a history of large moves after the earnings are announced, and to find undervalued option contracts that were not pricing in those potential large moves . DG is one of those stocks that has a history of large moves during earnings. It doesn't happen every time, but it happens often enough to give the trade a try. How large is large enough? Well, in DG's case, it can easily jump anywhere from $5 to $10 after earnings are announced, and as long as we can find cheap options within that range, it could be worth a stab. Before I get to the recommendation, remember the caveats: 1. These recommendations will all be unofficial trades. So you can't hold me to it! 2. Buying options has a very low probability of winning. You all know my thoughts on that. There's a reason why we stick with selling put options - the win rate is 90% and higher. You don't want to mess with that. So, if you get involved with the buying options game, be prepared for more losses than gains. Since I've always said that earnings are a crapshoot and you never know which