January 10, 2020  Terry’s Tips Trade Alert   –  Earnings Eagle  portfolio

 

PNC announces earnings before the open Wednesday, January 15, and will go ex-dividend for a $1.15 dividend the following day which makes an interesting scenario.  Buying the May series would insure that if we go to Plan B, our long positions would come after the next earnings date, and we would own high-IV options if we continued out to that time.  The options are pricing in a 3.3% move while the recent average move has been 1.9% which gives us a decent advantage.  

 

BTO 2 PNC 15May20 155 puts (PNC200515P155)

STO 2 PNC 17Jan19 155 puts (PNC200117P155) for a debit of $4.75  (buying a calendar)

 

BTO 1 PNC 15May20 155 put (PNC200515P155)

STO 1 PNC 17Jan19 157.5 put (PNC200117P157.5) for a debit of $4.02 (buying a diagonal)

 

BTO 1 PNC 15May20 160 put (PNC200515P160)

STO 1 PNC 17Jan19 157.5 put (PNC200117P157.5) for a debit of $6.20 (buying a diagonal)

 

BTO 2 PNC 15May20 160 puts (PNC200515P160)

STO 2 PNC 17Jan19 160 puts (PNC200117P160) for a debit of $5.08  (buying a calendar)

 

BTO 1 PNC 15May20 160 call (PNC200515C160)

STO 1 PNC 17Jan19 162.5 call (PNC200117C162.5) for a debit of $5.19 (buying a diagonal)

 

BTO 1 PNC 15May20 165 call (PNC200515C165)

STO 1 PNC 17Jan19 162.5 call (PNC200117C162.5) for a debit of $3.49 (buying a diagonal)

 

BTO 1 PNC 15May20 165 call (PNC200515C165)

STO 1 PNC 17Jan19 165 call (PNC200117C165) for a debit of $4.00  (buying a calendar)

 

Be[Ta1]  prepared to change this (these) price limit(s) by $.05 or more in order to get an execution.

Happy trading.

Terry