What Impact Do Earnings Reports Have on Day Trading?
What Do Earnings Reports Mean to Day Traders?
Next week marks a significant point for investors to re-evaluate both their existing portfolios and their overall investment strategy. As quarterly earnings reports are released from over 100 of the US S&P 500 corporations an opportunity is presented to day traders to take a sanity check on their approach to buy and sell choices.
Companies reporting at the end of April include:
- Financial firms such as Goldman Sachs and Morgan Stanley
- Consumer giants including Coca Cola and Pepsico
- Technology companies Yahoo, Alphabet, and Netflix
- Construction-related industries such as Sherwin-Williams and homebuilder Pulte Homes
With this cross-section of the business world reporting income, earnings per share, and net sales to the public, shareholders and prospective investors gain valuable insight:
- Are you achieving the goals of your investment plans?
- Is the economy rebounding and producing solid results that warrant additional investing in the companies you’ve selected?
- Have global conditions responded to financial stimulus and bail-out efforts to restore future confidence from investors?
- Are your investments performing at the rate you need for financial security in retirement?
- How do the earnings square up against the last earnings report, or last year’s report for this quarter?
Analyzing the information provided in these earnings reports helps investors and day traders plan their next financial moves for the stocks or market segments to focus on for future gains. Measuring earnings information against past reporting provides a good barometer for future performance expectations.
What Other Factors Besides Earnings Reports Influence Day Trades?
Once earnings reports become public the information is out there for everyone to review and make trade or long-term investment decisions. Financial analysts often provide insight (basically educated opinions) on their predictions or expectations for earnings report content. Keeping abreast of these predictions can provide a day trader with the edge in making trades that leverage such knowledge to time buy or sell orders that take advantage of the release of public earnings reports.
Utilizing this information from a trusted online broker or financial analyst allows you to sell off holdings before negative earnings reports surface that result in a drop in stock value. Contrarily news of higher than expected earnings can result in a stock price surge that makes buying in advance of the earnings report a great opportunity to buy low and sell at a profit.
Other items such as real-time knowledge of company internal reorganizations, market expansion, and new products can enhance your gains by buying in advance of other traders. This requires focus on your individual markets or stocks to act quickly when such conditions arise.
Remember that earnings reports may not always tell the whole story about the company you’re investigating. Earnings may be impacted by investments in new products or market expansion, expenses related to mergers and acquisitions, and other factors. Size up the entire picture of your targeted market or company before making that buy or sell decision.
Putting Earnings Reports and Predictions to Work for You
To take advantage of earnings report impact that benefits your financial decisions select an online broker that provides quick access to news feeds and analytical tools such as tickers and stock charts. Utilize tools that are easy to understand to maximize the effectiveness on your decisions.
SureTrader is an online broker that provides every client with features and options focused on making your trading sessions efficient and profitable. Lightning-fast execution of orders enhances your trade results. Tools are available to facilitate analysis and to provide access to information relevant to your trade activity.
Simple fee structures and friendly courteous service available 24×7 to answer your questions and resolve problems quickly add to your trading session success. Access SureTrader services anywhere, anytime with your desktop, laptop, and mobile devices. Mobile support includes Android and iOS devices. Trade on your schedule even in after-hours markets.
Contact SureTrader right away to get started doing trading with the best in online brokers.
Disclaimer: SureTrader Blog is not intended for U.S. persons. Stock information is not to be viewed as buy or sell recommendations.