r/stocks
Holding Through Earnings, What MU Taught Me
Shares options strategies to navigate MU's IV crush, staying long-term bullish on fundamentals backed by $22B in customer prepayments.
- Long-term fundamentals are extremely strong, evidenced by customers putting down $22B in cash upfront for long-term contracts.
- Massive historical financial results, with revenue hitting $41.46B and guidance midpoint at $8.49B, showing strong business momentum.
- The stock has strong year-to-date momentum, up 325%, indicating robust market confidence in the company's trajectory.
- High information asymmetry makes it nearly impossible for retail to beat institutions when simply guessing earnings beats.
- Extreme pre-earnings implied volatility (IV over 180%) means the market has already priced in massive moves, leading to severe IV crush post-earnings.
- High pre-earnings valuation and priced-in expectations limit the upside for naked long options, as seen in the wild premarket swings.
MU reported after hours yesterday. Closed the session +15.74%, hit +18% intraday. But that 15 minute premarket candle swung from +18% down to +8%, then ripped back to +13%. If you were holding naked calls at Thursday's close, that 10% premarket range was more than enough to stop you out.
This is my third cycle trading MU options. Back in 2023, when MU posted a 5.8Bloss,IboughtcallsandpeoplethoughtIwasanidiot.In2025,with5.8Bloss,IboughtcallsandpeoplethoughtIwasanidiot.In2025,with37.3B revenue, I sold puts and got told I was too conservative. This cycle, I held a 1150C calendar spread through earnings. No naked longs. Why? Because MU's IV ran to 180%+ the day before the print. That level of IV means the market is pricing in an 8% to 12% move. And sure enough, the actual numbers, 414.6Brevenue,84.9414.6Brevenue,84.9500B midpoint guidance, each one historically massive. But the market had already priced in a lot of it.
MU is up 325% year to date. Your edge is not in guessing whether a print beats. At this level of information asymmetry, retail is never going to be faster than institutions. The real edge is in the gamma decay and IV crush the morning after. Once the market opens post earnings, OTM call IV collapses from 180% down to 60% or 70%. That decay happens faster than most people expect.
My strategy framework: if you must hold through earnings, avoid naked options. Use calendar spreads, sell the near month and buy the far month, to offset the IV crush. Or just go with a debit spread to cap max loss. One more thing I learned the hard way: don't reload immediately after the print. Wait 30 to 45 minutes for gamma and IV to reprice. The support and resistance levels you see after that window are the actual market conviction, not opening emotion.
I'm bullish on MU's fundamentals long term. The SCA long term contract customers put down $22B in cash upfront. That signal says more than any analyst price target. But fundamentals are one thing, position sizing is another. Anyone else hold MU through earnings? How did you hedge?
Not trying to be insulting, but this is not a repeatable predictive lesson, it's the pattern seeking superstitious type reasoning you see with people who win at slot machines.
I think the worst part about this thread is they made it after the earnings. After they survived. MU tanks post earnings this thread doesnt get created.
All the traders who read this are gonna be mad
I am holding MU and RAM. I got in late, so i won't make as much money as some other earlier people, but i am still making a lot of money. Good enough.
That’s the healthy way to look at it. Late entries just change the risk profile, not the validity of the trade.
Yeah, only kids whine "i want a pie as big as that guy or no pie at all, i am gonna look for some other big pie". That is a manchild mentality. I am making huge percentages cumulatively even at late entry.
The more relevant question is whether the remaining expected move justifies the risk at this entry point. Percentages don’t matter much if the distribution of outcomes shifts.
Isn’t it risky to hold ram since it is x2 leverage considering days like this when it is down significantly?
This is my third cycle trading MU options. Back in 2023, when MU posted a 5.8Bloss,IboughtcallsandpeoplethoughtIwasanidiot.In2025,with5.8Bloss,IboughtcallsandpeoplethoughtIwasanidiot
OP what in the absolute fuck happened here and why have you not fixed it yet lol
Saddled with Korean stocks up 200% ytd and 300% ytd yes
the real edge here isn’t predicting MU, it’s surviving IV expansion and crush cycles
Everyone talks about direction, but MU is mostly a volatility regime trade. Surviving IV expansion and crush is basically the actual skill.
DRAM all the way
How do you feel about dram considering it has somewhat dropped the last couple days and plateau’d? Correction or signs of the non stop rise is unsustainable?