How do you insure that the price increase due to earnings report is not already built into the price of the st

Question

ock now?

Answer 1

I do not believe you can.

Many short-term traders try to profit from earnings surprises, so the price of a stock usually changes before earnings come out in anticipation of the impact of the earnings release.

Remember that earnings surprises are not always positive. Sometimes some part of the earnings release will be a negative surprise and cause the price of the stock to go down. A good examply would be Systemax (SYX) which reported higher earnings Monday night but the stock fell 22% Tuesday.