Retail earnings are in focus this week, with Target (TGT), Walmart (WMT) and TJX Companies (TJX) all set to report. We should get an a good insight into how the consumer is holding up once these companies have reported.
Before a company reports earnings, implied volatility is usually high because the market is unsure about the outcome of the report. Speculators and hedgers create huge demand for the company’s options which increases the implied volatility, and therefore, the price of options.
