--- title: "Options Betting on Earnings Series -- How Volatile Will SanDisk's Earnings Expectations Be? How to Make Money with the Lizard Strategy?" type: "Topics" locale: "en" url: "https://longbridge.com/en/topics/40319868.md" description: "Speaking of the recent trend of $Sandisk(SNDK.US), it can be said to be outstanding, seemingly completely unaffected by the dark clouds of war. Its stock price soared to the sky, increasing about fivefold in the first 4 months of 2026. As for how we should operate at the current high price level, I believe many investors also have no clear direction, especially with the earnings report release after the market close on April 30th, coupled with the options expiring on May 1st automatically turning into weekly options. Whether the earnings will exceed expectations is one thing, but it's foreseeable that significant price fluctuations are hard to avoid..." datetime: "2026-04-30T09:44:10.000Z" locales: - [en](https://longbridge.com/en/topics/40319868.md) - [zh-CN](https://longbridge.com/zh-CN/topics/40319868.md) - [zh-HK](https://longbridge.com/zh-HK/topics/40319868.md) author: "[学霸君](https://longbridge.com/en/profiles/2421323.md)" --- # Options Betting on Earnings Series -- How Volatile Will SanDisk's Earnings Expectations Be? How to Make Money with the Lizard Strategy? Speaking of the recent trend of $Sandisk(SNDK.US), it can be said to be outstanding, seemingly completely unaffected by the dark clouds of war. The stock price has soared to the sky, roughly quintupling in the first 4 months of 2026. Regarding how we should operate at the current high price level, I believe many investors also lack a clear direction. Especially with the earnings report release after the market close on April 30th, combined with options expiring on May 1st automatically becoming weekly options. Leaving aside whether the earnings will exceed expectations, it's foreseeable that significant price volatility is hard to avoid. This is evident whether looking at the option IV or the recent historical volatility of the price. The annualized IV for options expiring on May 1st, the day after the earnings report, is generally above 170%. For longer-term options expiring 15 days after the earnings report, the annualized IV generally drops to around 120%. The volatility amplification effect brought by the earnings event in between is self-evident. Xueba Jun blindly guesses that SanDisk's stakeholders mainly fall into three categories: 1\. Those already holding long positions in SanDisk. 2\. Investors preparing to buy in before the earnings report to bet on a rise. 3\. Investors wanting to go short against the trend to profit from a pullback. Actually, regardless of the intention, Xueba Jun believes that measuring whether a trade is rational is never about going against or following the trend. After all, there's no absolute in market trends. Every trade is a trade-off between win rate and risk-reward ratio. What we need to do is find a relatively "cost-effective" point between the two. Therefore, today we won't analyze whether the price will rise or fall after the earnings report, but instead introduce a relatively high-value option strategy for betting on earnings: **the Jade Lizard Strategy**. It is a bullish call spread strategy plus a sell put strategy. How to construct it? Using SanDisk as an example: If we believe SanDisk's price will rise significantly after the earnings report but worry about the adverse movement loss from buying a call, we can first construct a bullish call spread. Suppose we buy a call at the 1180 strike price for $2400. If the stock price after earnings doesn't exceed 1180, we will lose the $2400 premium. To hedge this risk, we can sell another call at the 1210 strike, receiving a $1600 premium. This forms a bullish call spread strategy with a net premium outflow of $800, which is also the maximum loss. At this point, a bullish call spread strategy is constructed. If the stock price doesn't exceed 1180, the maximum loss is $800, which still doesn't seem very cost-effective. At this time, we can sell a put at a lower price to collect premium to offset this $800 net outflow. For example, sell another put with a strike price of 890, receiving a $780 premium. The final actual premium outflow is only $20. This way, we have approximately constructed a zero-cost combination to bet on SanDisk's price rise. To summarize: Three options with an expiration date of May 1st: Buy a 1180 call, premium outflow $2400 Sell a 1210 call, premium inflow $1600 Sell an 890 put, premium inflow $780 Net premium outflow $20. The maximum profit is when the stock price rises above 1210, which is $2980. (1210-1180)\*100-20 If the stock price falls, as long as it doesn't fall below $890, the maximum loss is $20. This is equivalent to us using a maximum loss of $20 to pursue a maximum profit of $2980. If successful, the risk-reward ratio is close to 15 times. If the stock price falls below $890, the loss will expand. The actual loss becomes (890 - post-drop price)\*100 + 20, which is approximately equivalent to us needing to purchase the stock at $890 and then bear the loss if the price falls below $890. Therefore, when using this strategy, you must choose a strike price for the sell put at a level where you are willing to take delivery of the shares. The profit curve of this strategy is shown in the figure. It should be noted that all the above price parameters are for illustrative purposes. The actual selection of strike prices should be based on individual stock price expectations and risk preferences. If we want to truly construct a zero-cost Jade Lizard strategy, we need to calculate the required prices for constructing the combination based on premiums at different price levels. Secondly, zero cost does not mean zero risk. If the stock price falls below the strike price of the put, we will still incur losses. Summary: **The Jade Lizard** is a **neutral to slightly bullish, high win rate, no upside risk** option premium strategy. The core is: **sell out-of-the-money put + sell bear call spread**. Use the call spread to lock in upside risk, leaving only limited downside risk, and earn the net premium. Suitable for situations where you want to use a smaller cost to pursue larger upside gains. Alright, that's all for today's strategy explanation. If you have any questions about the above content, feel free to leave a comment and ask! ### Related Stocks - [SNDK.US](https://longbridge.com/en/quote/SNDK.US.md) - [SNDKV.US](https://longbridge.com/en/quote/SNDKV.US.md) ## Comments (4) - **在学习中前进 · 2026-05-01T14:15:07.000Z**: The stock price may fall into any of the four ranges formed by these three numbers: 890-1180-1210. How should one operate in each scenario? - **学霸君** (2026-05-02T02:13:55.000Z): If the stock price is below 890, the effect is equivalent to selling a put and having to take delivery at 890. Therefore, the strike price for this leg should generally be chosen at a level where you - **Supermax · 2026-04-30T18:12:13.000Z**: Sell 1210 call premium income 1600Sell 890 put premium income 780Where did these two options come from? - **学霸君** (2026-05-01T01:26:21.000Z): You can find these two options directly on the options quote screen, and the quoted price is the premium income.