Strategy · Event-Driven
STAKE INTO CATALYSTS
BullishDefined riskIntermediate
Overview
Build a Yes position 3-7 days before a known catalyst (Fed meeting, OPEC announcement, earnings beat). The volatility-and-attention surge typically pushes prices toward consensus before the event.
Setup
- 1.Mark the known catalyst date on a calendar.
- 2.Compare current contract price to your post-event probability estimate.
- 3.If gap > 8 points, scale in over several days.
- 4.Reduce position 12-24h before the actual event to avoid binary outcome risk.
- 5.Take partial profits if price approaches your fair value before the event.
- 6.Re-enter after the event only if mispricing persists.
Max profit
Pre-event drift typically captures 30-70% of the eventual full move.
Max loss
Entry price per contract.
Breakeven
Entry price.
When to use
Around scheduled events with high information flow. Best when retail attention is still light.
When to avoid
On surprise events where you cannot pre-position. When the move has already happened.