27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.
Apple, Inc (NASDAQ:AAPL) will report its fiscal fourth-quarter earnings after Wednesday's close.
Benzinga took a look back at Apple’s last seven fourth-quarter earnings reports to look for any potential patterns in how the stock reacts.
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- Q4 2018: shares down 6.6% the day following the report
- Q4 2017: up 2.6%
- Q4 2016: down 2.2%
- Q4 2015: up 4.1%
- Q4 2014: up 2.7%
- Q4 2013: down 2.4%
- Q4 2012: down 0.9%
The charts below show Apple’s largest single-day gains and losses of the past eight years. The dates highlighted by the red boxes indicate trading sessions that occurred within two days of a quarterly earnings report.
Many of Apple’s most volatile trading sessions of the past eight years have happened within two days of an earnings release. While Apple tends to have volatile earnings reactions, fourth-quarter market reactions haven’t typically been some of the biggest.
Apple's stock has typically moved up or down more than 2% on the day following fourth-quarter earnings. Five out of Apples last six earnings reports have generated positive market reactions, but two out of its last three fourth-quarter reports triggered a sell-off.
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According to Optionslam.com, Apple’s seven-day implied movement based on the weekly options market is 4.5%.
Benzinga's Take
Apple doesn't have a great track record with fourth-quarter reports, which is likely a reflection of high market expectations. With the stock up 17% in the past three months headed into earnings, traders should watch out for a sell-the-news reaction if Apple doesn't deliver a significant beat.
Apple's stock traded around $243.76 per share at time of publication.
Do you agree with this take? Email feedback@benzinga.com with your thoughts.
Related Links:
Apple Q4 Earnings Preview: The Street Eyes Strength In iPhone, Services
Pick Up The Phone: Apple To Report Amid Enthusiasm Over Recent Launch
This story was originally published Oct. 31, 2018 and has been updated.
27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.