YY Inc. (YY) is a social platform that engages users in real-time online group activities through voice, video and text on personal computers and mobile devices. The сompany's segments include YY IVAS and others, Huya broadcasting, and 100 Education. YY enables users to create and organize groups of varying sizes to discover and participate in a range of online activities, including music shows, online games, dating shows, live game broadcasting and e-learning. YY offers users an entertainment experience through its social community. It is reporting earnings on Wednesday, August 17, after market close:(Source: TD Waterhouse)As evident from the above, the company beat earnings estimates in 66% of time in the last six quarters, underperforming in the rest of time, and has seen modest volatility in the market price of its stock over the last three month: $YY, JOYY Inc. / 60 The market participants expect the following numbers over the next few quarters, including the upcoming one:(Source: TD Waterhouse)Market data show that the August options are a bit overvalued:(Source: TD Waterhouse)The one-week straddles (options with a strike price of $48.50 and expiring on August 19, 2016) are worth around 6.9% of the current market price of the stock. Historically, the stock has been more volatile than that on a monthly basis over the last year:(Source: Google Finance. Calculations by author)As you can see, the stock has had a monthly standard deviation of 12.6% over the last 52 weeks, while the straddle expiring in a week has an implied monthly volatility of around 4.8% (calculated based on 3 business days remaining until expiration), also including volatility from the earnings event this week. I therefore see signs of modest overvaluation in these options. Hence, selling the straddles is a good idea from a theoretical standpoint.Investors may also be interested in selling iron condors to capitalize on the above-average implied volatility, while hedging against swift moves in the underlying:(Source: optionsprofitcalculator.com)The risk-return profile of this trade looks like this:(Source: optionsprofitcalculator.com)As you can see from the above illustration, the "window of safety" is around 12.6%. This means that the stock has to move roughly 6.5% in either direction from the current price by expiration in order for investors to start losing money. The risk-reward ratio of around 1:0.88 is above-average this type of option strategies and is deemed attractive.