Bull Put Diagonal Spread for Earnings announcement

Profile: Steel Dynamics, Inc., together with its subsidiaries, engages in the manufacture and sale of carbon steel products in the United States. It operates in three segments: Steel Operations, Fabrication Operations, and Steel Scrap and Scrap Substitute Operations. Steel Dynamics was founded in 1993 and is headquartered.

Trading Stance: This is going to be a great lesson for all of you who have never held a stock through earnings and profited. You’ll see the surprises if any, the immediate volatility changes in the options and the actions needed to be taken if a reversal occurs.That said lets look at the stocks position as it sits at the one year and five year high.Even though we’ve initially entered a bullish trade we do expect a bit of profit taking to step in (eventually), that is why we’ve used puts instead of calls since a mysterious reversal could always be triggered. So for now we’ll see what the news will bring us on Tuesday and of course this next week is April expiration, that too could be exciting but shouldn’t affect our May position adversely.