November 12th

One aspect of Theta Positive trading we have not yet discussed are "Earning Plays".

Earning plays are speculative Theta Positive trades and should be made in a "gambling" size. Ergo you are willing to loose all or most of the trade.

Tonight we have AMAT coming out with earnings. The excitement of the earnings gives the front month an elevated IV. Nov IV is 117 and Dec IV is 88. So by setting up a Nov - Dec calendar you make good use of that IV difference.

Tomorrow when the earnings are out the difference between front and back month IV will moderate and the calendar will become more expensive. I bought the calendar for 38ct.

The closer the earnings event is to the expiration date, the quicker the front month IV will evaporate. Earnings plays in the last 10 days of the expiration month are relatively low risk speculative trades.
You can check the prior earnings to see how the market has predicted past earnings moves.
More on how to read the predicted market move tomorrow.