Shares of Nvidia Corp. fell 0.7% in midday trading, ahead of the graphics chip maker's third-quarter results, due out after the closing bell. Options traders are prepared for some volatility on Friday in reaction to the results, but a move that is less than what investors have grown to expect over the past several years. An options strategy known as a straddle, which is a pure volatility play that involves the simultaneous purchase of bullish call and bearish put options with at-the-money strike prices, expiring Friday, are priced to start making money if the stock moves 6.7% in either direction on Friday. The average move in the stock the day after earnings has been 8.9% over the past 20 quarters, and 7.2% the past 10 quarters, according to an analysis of data provided by FactSet. The stock has gained the day after 12 of the past 20 quarterly reports, by an average of 11.0%, while the average decline has been 5.7%. The median move the past 20 quarters has been 7.0%, and 5.3% the past 10 quarters. Nvidia's stock has run up 38% over the past three months, while the PHLX Semiconductor Index has soared climbed 19% and the S&P 500 has tacked on 8.6%.
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