Trade Update Dec 20th, 2012 at 10:04am: With JOY straddling the 62.5 strike, and one day until expiration, the calendar is worth more than a double from what I paid last week prior to its Q4 earnings. I thought it was a good time to take the trade off and book the profit and avoid a large move one way or the other that has the potential to erode the profit.
Action: Sold to Close JOY ($62.45) Dec/Jan 62.50 Call Calendar at 1.85 for a .97 gain.
Original Post Dec 6th, 2012:
Event: JOY reports fiscal Q4 earnings prior to the open tomorrow, the options market is implying about a 5.75% move, vs the 4 qtr avg move of about the same at 6%.