Thu. Apr 18th, 2024
Earnings Season

Earnings season is important and we need to have a concise idea on what it means. This would be of utmost help for an investor who is just planning to invest in stocks.

Let us proceed. At a generic level when large companies go on to release their quarterly reports it is termed as earnings season. People give due attention to the earnings date for Facebook reports as well.

Earning season

Once the quarterly reports are published the earnings season begins after a month or so. Say once the quarter reports are out in the month of March the earnings report would be a couple of weeks after that. What it would mean is January, April, July, and October typically connote the months of the earnings season. Now the question at the back of your mind is do we need to be bothered about earnings season? Yes is the answer and let us get to the details. With the help of earnings season, it allows an investor to observe the financial details of the company they plan to invest. If things are in their favor they invest. If this is not the case they wait until the right moment arrives for investing.

But a point that you need to consider is all public limited companies are not going to release their reports during earnings season. Another important pointer exists about the earnings season is that the big companies release their reports when the market is closed. This means that after the trading hours at 4.00 pm and before 7.00 am in the morning the reports are released. Companies undertake this venture for a specific reason as they want to tap as many investors as possible. The reason being that if they release their reports during the stock trading hours, chances are high that many people would miss on getting to the reports. Release off the report during the off hours will force investors to go through the reports properly and respond.

In a stock market, a single piece of information can change the outcome of a company in the market. Via quarterly reports, it provides vital insights on how a company is performing in the days to come.

How you can cash in on the boom of the earning season?

For an investor, this seems to be an obvious question and there is a way by which you can approach this

In order to make some decent money earnings season are the best time. Now, why? The reason being earnings season provides you with a lot of information that has an impact on the stock market. Another trend is new information goes on to have an impact on the stock market the most, so as an investor you should be able to make some decent amount of money by buying or even selling stocks.

Earning seasons are of paramount importance during the course of a year. The third earnings season seems to be the most important. A definite logic exists behind this as earnings during the third season shakes up the stock market. At this point in time, the companies are on the verge of year-end and the investors are in a position to make some decent amount of money. At the same time, the stock market fluctuates up and down during this period. The tech industry and consumer industries do have the most important demand at this point in time. As an investor, you need to keep a careful eye during the third season.

In order to make a profit from the earning seasons, it is better to purchase straddles. Now the question is what straddles are. They do go on to compromise the pull and call options. This presents a trader with a couple of options. In case the price of the stock goes up they would be able to avail the call options at a higher profit and if the price goes down it is going to be put options in order to make profits.

In terms of investment, you need to study a lot. Start with the financial reports of the company and try to invest small amounts. This would give you an idea of whether your judgment is good or not.

By admin