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Don’t Get Suckered Into Trading Bank Earnings

by | Oct 7, 2022 | Options

The first week of October is in the books, and volatility continues to run amok…

Like it or not, markets are laser-focused on inflation and interest rates…

Because of that, data like this week’s jobs report and Federal Reserve presidents flapping their jaws are likely to cause wild swings like we saw Friday.

But we can only trade the market in front of us. And until things change, the New Money Crew strategies will keep targeting tickers that aren’t dependent on the broader market…

And that approach helped Heavyweight Trade Alerts snag an explosive win on CVS Health’s latest merger and acquisition target!

Master Indicator Spots M&A Mover

It’s been an excellent year for M&A trades, and now Master Indicator is getting in on the action!

At the end of September, news hit that the primary care provider was looking for potential buyers, piquing the interest of Humana Inc. (NYSE: HUM) and CVS Health Corp. (NYSE: CVS).

My scanners picked up on a spike in trading volume for Cano Health Inc. (CANO) late on Monday, with my indicator sending four different buy signals in the last two hours of trading…

So when a massive 60,000-contract block of call options hit the wire — worth around $7.5 million in premium — I sent the alert for members to target the Dec. 16 expiration, $7.5 strike calls!

More news hit Monday that CVS was in exclusive talks to buy Cano, and shares catapulted as high as 10%, helping us close our calls for a 28.5%* return in four days — crushing our average return of 13% including all winners and losers, and our seven-day holding period to improve our lifetime win rate to 73.9%!

And with volatility as high as it is, I’ll take meat-and-potato gains like these every time!

Why I Steer Clear of Bank Earnings Trades

With the close of September, it means one of my favorite times of the year is fast-approaching — earnings season!

I love trading earnings events, and for good reason… Stocks usually make big moves about four times a year, and that’s around earnings.

Those big moves present a fantastic opportunity for traders of all sizes to capture monster gains in the stock market.

But trading bank earnings for third quarter 2022 — and most quarters — are by and large a different animal.

After all, we’re talking about institutions priced to perfection with armies of financial experts who say and do all the right things.

Bank earnings trades can look great on paper, but Mr. Market will have Q3 already baked into the price.

So even with the headlines surrounding Credit Suisse Group AG (NYSE: CS), we’re not likely to see any surprises with big names like JPMorgan Chase & Co. (NYSE: JPM), Citigroup Inc. (NYSE: C) or Wells Fargo & Co. (NYSE: WFC).

Because of that, the major banks just don’t move a lot, even when we trade earnings. It’s also why we haven’t seen much big institutional order flow into bank options so far.

Check out the clip up top and I’ll show you why you won’t catch me trading bank earnings…

P.S. Get Ready to Crush the Open With Jeff Zananiri & Lance Ippolito!

Jeff Z and I are going live before the opening bell from 9-9:30 a.m. EDT every single Monday to talk about…

Big market-moving announcements coming this week.

  • Their predictions and key levels to watch.
  • Trade setups they’re eyeing. 
  • Live trading.
  • Sports.
  • And so much more! 

It all kicks off at 9 a.m. EDT, Monday, Oct. 10. So come Crush the Open with us!

Save this link: https://special.wealthpress.com/crush

*Stated results are atypical for given period. Past performance is not indicative of any future results. Trade at your own risk.

WRITTEN BY<br>Lance Ippolito

Lance Ippolito

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