20070419 - GOOG - Daily - Gain

After reading Kevin's post on (GOOG) yesterday, I have decided to exit my holdings on GOOG before the market close today.

I earned a 'whopping' 65 cents per share! Hardly enough to cover my transaction fees!

Although Google released some very impressive numbers on their earnings, just like what Kevin mentioned, 'trading the Earning Release' is very risky. If you think about it, those CEOs or CFOs are basically going to come out and say... Earnings are:
1) Above Expectations
2) Meet Expectations
3) Below Expectations

Under normal circumstances, only 'Above Expectations' would bring you 'winnings', assuming that you are 'Long' on the Stocks. The other 2 results will likely to bring the share price down! Therefore, you are betting against the odds of 1 out of 3 that the price will go up.

Of course, you can argue that if you go 'Short' before the Release to get the odds in your favor! But are you really going to bet against companies like Google?

Anyway, I might not be making any sense at all on this topic. But at least this is how I see it when it comes to playing the Earnings game.

Let me know what you think!