TCIC Monday Email – Earnings Season

Greeting team:

This is the Monday email. Welcome.

This is an exciting time to be investing.  Its earnings season.  There is money to be made if you guess right. I have done very well investing into earnings season.  Here are a few tips that I want you to keep in mind if you plan to invest right now.

Follow the trend:  The trend is your friend.  When you are analyzing a stock going into earnings you need to find out where the trend is headed. Is it headed up, down or sideways?  This is important as a foundational tool to figure out what you should do next.

Chart: In looking at the trend you need to look at different date ranges on the chart.  I like the short term one-week chart, the midterm three-month chart and the 12m chart.  The three-month chart is important because it allows you to see what the stock has done since they last reported earnings.

News: Pay attention to the news.  You can usually find a ton of pre earnings reports where analysts report on what is important for the company in the quarter.  They will also give you and indicator of if they are bullish or bearish heading into earnings.

Go with your gut: I always say that I don’t buy the options of a stock I wouldn’t buy.  Earnings is not a short cut it just enhances the work that you have already done.  Don’t just buy options because it can pop if you know nothing about the company.  You must have a good understanding of the quality of that company to know if it is underpriced or overpriced. Trust your gut, don’t chase a quick buck.

Bet on a reversal: Sometimes, most of the times, earnings pop hard when they do the unexpected. This means that a company that was trending low after last earnings could surprise folks.  A company that was doing well could end up being all hype.  This is where being a contrarian comes into play.  All those reports you are reading and charts you are analyzing might be the reason why the stock is low or high.  New earnings and financial reports snap the stock back to reality. You want to be there to capture the gains when this happens.

In regard to our current portfolio, nothing has changed from last week. Still about 20k total liquid with 50k total assets. Our mid-month pull is coming and when that happens, we will get fresh money.

In regard to votes not passing, this was to keep everything from passing. Let’s try to have votes monthly like we used to do.

Conference call will be next week.  Look for that. Feel free to reach out if you have any questions.  Happy investing. 

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