An earnings miss sets up a 40% return

This earnings miss could set up a nice 40% gain
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This earnings miss could set up a nice 40% gain

In a typical quarter, more than 70% of companies beat earnings expectations. That means misses are unusual and unusual events can often be traded.

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We share the actual recent market data that highlights a trade with tremendous potential. The trade is in a large cap stock, not the type of company many investors typically consider when they are searching for double digit trading opportunities.

That's because large stocks often make average sized price moves and traders with limited capital may believe they can find better opportunities for rapid gains in smaller stocks. There is an appealing logic to that belief, if one is simply buying the stock and holding in the hope the price will go up.

But there are alternatives to buy and hold as we explain.

Some investors may avoid large cap stocks because they may lack the capital to build a diversified position in this type of stock. However, as we explain in our latest article, there are strategies that lower the capital required to trade these stocks.

In the article, we explain in detail, one such options strategy. This strategy is one that is focused on risk. Despite that focus, the strategy is still capable of delivering decent short-term returns. We show what the amount of risk is in dollar terms and we also detail the potential gains of the trade.

You can find all of the details of the strategy and the specific trade in our latest free educational article that is available right here.

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As defined in the United States Securities Act of 1933 Section 27(a), as amended in the Securities Exchange Act of 1934 Section 21(e), statements in this communication which are not purely historical are forward-looking statements and include statements regarding beliefs, plans, intent, predictions or other statements of future tense.

Investing is inherently risky. While a potential for rewards exists, by investing, you are putting yourself at risk. You must be aware of the risks and be willing to accept them in order to invest in any type of security. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to Buy/Sell securities. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results.



 

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