Western Digital (WDC) expected move

Frequently asked questions

What is the WDC expected move?

The size of the price swing the options market is pricing for Western Digital (WDC) by a given expiration. The at-the-money straddle (call plus put at the strike nearest the stock price) is the market's own quote for it; the IV sigma is the same idea computed from implied volatility: price × IV × √(days/365).

Is the expected move a prediction?

No. It is a one-standard-deviation range, so the stock is expected to finish inside it roughly 68% of the time and outside it about one week in three. The two-sigma range covers about 95%.

Why does the straddle differ from the IV sigma?

The straddle is a traded price that includes the bid/ask spread and the skew between puts and calls; the sigma is a model number from one at-the-money IV. They are usually within a few percent of each other; a large gap means the quotes are stale or wide.

What does the earnings flag mean?

That expiration is the first one that captures the next scheduled earnings report, so its expected move includes the earnings jump the market is pricing. Compare it with the expiration just before it to see the earnings premium.