(10) Never Expect Big Moves Near Expiry Of Derivatives
It is one of the most technical strategies or tips for share trading during earnings calendar. Expiration date of all listed option contracts may vary from one country to another.
In US, it is usually 3rd Friday of contract month while in India, it is on last Thursday of contract month. Investors usually prefer to book profits near contract expiry.
Those who were trapped in wrong position will not get any chance to cut their losses. Thus, you should not expect any magical movements near expiry even if results are declared around it.
However, big movements may occur but only in rare case scenario. Sometimes, big investors or traders may bring good change even after few of days of result announcement.
(11) Try To Look Beyond Consensus
It is one of the wonderful tips to trade stocks during earnings season. Result season is always accompanied with stock analysts estimates or consensus about company’s performance.
Generally, consensus estimate is an aggregation of individual forecasts. It may not include what the best analysts think about a given stock.
Some stock experts or analysts are widely known for providing accurate earnings forecasts. However, others are known for missing their forecast with a wide margin.
Therefore, it’s wise decision for investors & traders to follow analysts with best & proven track record. You should use their forecast rather than following consensus blindly.
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