
Just a handful of names will be reporting earnings this week including Carnival (CCL), Walgreens (WBA), Lululemon (LULU), Futu Holdings (FUTU) and Micron Technology (MU).
Before a company reports earnings, implied volatility is usually high because the market is unsure about the outcome of the report. Speculators and hedgers create huge demand for the company’s options which increases the implied volatility, and therefore, the price of options.