Another week of earnings, although we are most of the way through the season now. Some key names reporting this week include Home Depot (HD), Walmart (WMT), Target (TGT), Cisco (CSCO), Deere & Company (DE), Applied Materials (AMAT) and Foot Locker (FL).
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.
