Tesla could see big swings on earnings. This 'Iron Condor' options trade can mitigate volatility risk

In a year dominated by pessimism, Tesla has plunged 54% from its December highs, reflecting the deeply bearish sentiment that currently surrounds the stock. As a sentiment-driven name, extreme negativity often sets the stage for unexpected upside surprises—and that's where the real risk can lie for those on the sidelines. A glance at TSLA's three-year weekly chart shows the stock trading near a long-term support zone, a level that has historically attracted buyers. On the upside, the next major resistance area sits around $265. Looking ahead, TSLA is scheduled to report earnings on Tuesday after the market close. In the lead-up to such events, options premiums tend to rise as traders position for volatility. This phenomenon, driven by anticipation rather than actual movement, is captured in the concept of implied volatility (IV) — ...
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