What Is An Earnings Surprise?

Earnings season is one of the most exciting times on Wall Street.

Thousands of publically traded companies hope to impress investors with their quarterly financial reports. In the same vein, retail traders often look at this event as a chance to ride quick price moves, especially if the company beats analysts' earnings per share (EPS) expectations.

If a company can produce higher numbers than external forecasts, they are likely to turn heads. And while it's important to note that traders and investors should carefully consider the entirety of a company's quarterly report, EPS is often the key performance indicator.

You may think that a stock price would jump every time a company delivered an EPS above analysis' estimates. But, solid earnings announcements don't always translate to big stock moves... sometimes, they can do the opposite. Continue reading "What Is An Earnings Surprise?"

Define Value and Determine Momentum

Today we've asked our friend John Seguin to discuss his groundbreaking trading strategy. John has been member of the Chicago Board of Trade (CBOT) since 1986 and is a seasoned veteran of the trading floor. Working as a broker and analyst for dealer firms such as, DCNY, Greenwich Capital, Sanwa Bank and FIMAT. During his tenure in the trading pits, John began working on an enhanced trading system to address the key components needed to enter high probability trades with defined risk. When industry migration from floor to screen began to unfold, he also took the challenge of producing sound and timely trading strategies for off-the-floor traders to task seeking alternative methods to fill the void of real time information floor traders were able to collect from watching order flow in the trading pits. John has agreed to give our Trader's Blog readers free access to the macrograph charts for two weeks. Continue reading "Define Value and Determine Momentum"

Options: Two Ways to Play Dividends

As with trading any financial product, there are many strategies to choose from. One strategy isn't necessarily better than another and many times the strategy that works best for you simply depends on your trading style.

Today's guest blog post is from Elizabeth Harrow of Schaeffer's Research and she is sharing 2 different options strategies that revolve around playing dividends. Enjoy the post below and leave a comment on the blog. If you like this article and wish to receive 6 months free Option recommendations, please click HERE.


As you may or may not be aware, dividends are one of the many factors that influence an option's price. Because dividends don't have as big an impact as other variables, such as time decay and implied volatility, they're generally not a topic that I dedicate a lot of time and analysis to. However, every option trader worth his or her respective salt should know that dividends create trading opportunities (even if only so that he or she can break out this tidbit at particularly boring cocktail parties). So, in today's column, we're going to take a look at two common ways to trade around dividends.

Dividend arbitrage

First up is dividend arbitrage, which uses a combination of stock and in-the-money puts to capitalize on dividend-related price changes. Continue reading "Options: Two Ways to Play Dividends"

POLL: Are You Off For The Summer?

While some traders see the summer months as an opportunity to get away with their families, others keep pounding out trades all summer long, just as if it were any other time of year. This year the dip in trading volume seems to be a bit more extensive due to the current state of the economy. Many people have pulled out of trading, at least their trading of stocks, which leaves much money on the sidelines, and we are already heading into summer with a few months of lowered trading volume at our backs. So we are curious...

What is your trading strategy for this summer?

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Strategy Trading Using Next Day Predictive Highs & Lows

Setting yourself up to catch the next day's market moves can be a daunting task. In this complimentary trading video, Darrell Jobman, published author of more than a dozen trading handbooks and editor of major financial publications, will walk you through his strategy of using predictive highs & lows to develop a plan for next day trading.

Could this strategy be what your trading plan is missing for 2011?

WATCH NOW: Click here to start watching Darrell Jobman's trading video, "Strategy Trading Using Next Day Predictive Highs & Lows."

You have nothing to risk and everything to gain.

Trend TV Team