YUM Strangle

YUM will be reporting earnings on Oct 6.  The Oct 47 calls are around 0.81 and the Oct 45 puts are around 51 cents for a total entry price of around 1.32 + commissions.  I would expect the stock to move around 4 to 5 dollars after earnings based on past movements.

Update:  The way I would play this is that you would need to be up and monitoring your position on the morning of Oct 6 to the reaction to the earning news.  At that point, you would have to decide when to close your position.  I will post my update when I close out my position.  If the stock makes a strong move in one direction, you can close out that position and decide to either close out the opposing position or wait another 3 days until expiration to see if the stock then moves the other way.  Blowout earnings will probably result in a gap up, whereas, missing earnings will end up in a gap down.  The worst scenario is that the company meets earnings and the stock does not move much, but I would expect the chances for that to be low.