(CNBC) Traders who have pursued a strikingly simple strategy this earnings season have cashed in big time.
Goldman Sachs' options research team has long advocated buying calls on stocks set to report earnings. Simply put, the average stock rises on earnings, taking the price of the relevant calls (which are options that grant their owner the right to buy a stock for a given price within a certain time frame) higher along with it.
The strategy of buying calls across the board has "produced an average profit of 14 percent" and was profitable in each of the 19 years studied, Goldman's team reported in an earlier note, although they took pains to add that the strategy doesn't necessarily adequately compensate investors for the risk they are taking on by buying oodles of options.
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In the early days of this earnings period, however, those pursing a pure call-buying strategy have enjoyed an incredible bonanza.