Earnings Playbook AU v2
A practical, Australia-focused framework for trading ASX options around earnings — scenario planning, risk controls, volatility plays and trade templates tailored for the local market.
- Focus: ASX-listed stocks and options
- Approach: volatility-aware, risk-first position sizing
- Goal: repeatable, documented trades with defined exits
Core components
Pre-earnings checklist
- Liquidity & spread check
- Implied vol vs historical vol
- Delta targeting and risk per trade
Strategy matrix
When to use calendar spreads, straddles, iron condors or directional calls/puts based on skew and earnings conviction.
Post-earnings playbook
Exit rules, gamma risk limits and rehypothecation of premium into follow-up trades.
Scenario planning & trade templates
Define a 3-scenario plan (beat / in-line / miss) and map an option structure for each scenario with defined expected P&L bands and probability assumptions.
Template: Short-dated straddle (vol play)
- Entry: 10–7 days to earnings, ATM straddle
- Risk: max premium paid, leg-by-leg management
- Exit: close 1–2 days post-release if IV crush < target
Template: Iron condor (neutral)
- Entry: when implied skew high vs historical
- Width selection: based on realised move expectation
- Manage wings & roll if directional bias emerges
Earnings case studies (ASX)
Case: Consumer retailer — IV crush
Used short-dated straddle; IV collapse after modest beat produced limited loss vs expected premium decay.
Case: Resource stock — directional gap
Directional call spread captured a strong upside gap post-earnings; trade managed with trailing stop.
Signals, metrics & risk controls
Key metrics we monitor before taking a trade: implied volatility percentile, implied move vs historical move, options liquidity, and gamma exposure.
| Metric | Trigger | Action |
|---|---|---|
| IV percentile | >75% | Consider sellers or defined-risk wings |
| Bid-ask spread | >5% of mid | Reduce size or avoid |
| Implied move vs FY | > expected move | Prefer directional or skew trades |
Lead strategist — Alex Reid
Alex curates the playbook and oversees the ASX-specific signals and risk limits.