Although volatility has been taken away from the market, every now and then a stock will surprise on earnings and if the surprise is large enough, buying an option for that week might pay handsomely.
On Thanksgiving week, the following stocks were announcing earning before market open on Tuesday 11/26. BBY, BURL, DELL, DLTR, HP and DKS. Also DE was announcing earnings before open on Wed. BBY, BURL, DLTR, they all had substantial move that day, 10%+. DKS had about 7%. So at least on retail that game is on. I tested this strategy before but the move was not big enough to justify buying the strangle, since you do not know the direction. If you knew the direction, you almost guaranteed to make money.
But, BURL closest competitors is TJ Maxx. The latter is becoming like the rest of the discount clothing stores, all about female clothes. So in a way they have a niche. Also, they have been downsizing their stores so they are probably saving some money that they claimed on the “earning”. BBY is effectively the only nation wide electronic store. So it also has a unique set up since it allows vendor to have their own “stations” in the store. DLTR, was going down and went down further. I think them and big lots are going to disappear soon. Walmart is the new dollar store and everything else you can get on line. DKS, also effectively the only sport clothing store since the disappearance of Sport Authority. All the “one and only” stores will move substantially since they have the whole market basically.
Let us see what we can line up for next week.