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Found 36 results

  1. For full protection, buy ATM options ($98 strike) - all you can lose is the premium you pay (around $5 per 100 shares). So if NFLX will lose say $15, your puts will be worth $15, and you gain $15 minus the premium. If you want just "black swan protection" - against catastrophic loss, you can buy 90 strike. It will cost much less (around $2), but also protects you only if NFLX goes below $90. Another member suggested another strategy: "Alternatively, NFLX volatility is pretty low. Expected move around $9 - don't know the cost basis, but this is what I would do: AUG +95p / -90p / -110c for zero cost. Eg buying bear put spread and financing with 110 call. If NFLX goes down to 90, your loss (assuming 98 cost) is $3. Max gain at 110 is $12. Any outsized move down below 90 has no protection, and above 110 no gain." This is also a viable strategy, but it will protect you only down to $90. If the stock collapses below $90, you are not protected. Here are few other options: Collar Buy July 22 90 put Sell July 22 105 call You are protected below $90, and the gains are capped at $105. Calendar Buy August 19 90 put Sell July 22 90 put You basically buying the put expiring in 4 weeks and reducing the price by selling weekly put expiring the next week. Advantage: reduced cost (only 0.80) and very nice gains if the stock goes down to ~$90. Disadvantage: the spread will start losing money if NFLX crashes much lower than $90. There is no "best strategy" here. You can construct the trade based on your outlook and risk tolerance. And this is the beauty of options - there are endless possibilities to hedge, speculate etc. It's up to you to decide what to do, based on what you want to achieve. Want to learn more? Start Your Free Trial
  2. The following article described few stocks that we use over and over again, cycle after cycle. We said "$TSLA, $LNKD, $NFLX, $GOOG: Thank You, See You Next Cycle". Well, the Next Cycle is already here. NFLX is one of those stocks. Here are our results from NFLX in the recent cycles: +10%, +20%, +30%, +16%, +30%, +32%, +18% Another earnings cycle has arrived, and NFLX delivered another nice winner for us. We opened a pre-earnings calendar at average price of $3.50 and exited at average price of $4.55, booking a 30% gain in the process. That marks eighth consecutive NFLX winner in the last few cycles. But some of our members did even better. Here is a screenshot from the forum: This member booked 47% gain! Here is another one: And one more: Those are real fills from real members. Not hypothetical returns. REAL RETURNS FROM REAL TRADERS. Those returns are even more remarkable when you consider the fact that the stock moved 15%+ in the last few days. We played it non-directionally, so we didn't really care which direction it will move, but booking 30-50% gains on a non-directional strategy after such a move is truly amazing. Earnings season is just starting. We are planning to play GOOG, FFIV, CMG, FB, AMZN, MSFT, BABA, LNKD, TSLA and more. Each stock has its own "character", the best time to enter and its unique setup. We already booked 57.6% ROI since the beginning of 2015. We can help you. If you want to learn those profitable options strategies: Start Your Free Trial
  3. This video describes a trade on NFLX before earnings. The rationale was to take advantage of the increased volatility in our option by initiating this earnings play. We will show you in this video why this trade had a bad risk/reward despite inflated IV. Download video: How NOT to Trade $NFLX Earnings.wmv
  4. NFLX announced earnings today after the close. Couple hours before the market close, I got a following trade alert from one of options sites I follow: Trade: SELL -1 IRON CONDOR NFLX 100 APR 15 520/522.5/427.5/425 CALL/PUT @.91 LMT [TO OPEN/TO OPEN/TO OPEN/TO OPEN] Trade Explanation: For the Volatility Advisory in NFLX, we are selling the Apr 427.5 puts and 520 calls and buy the Apr 425 puts and 522.5 calls for a net credit of $0.91 to open. Underlying Price: $474.22 Click here to view the article
  5. Our long term members know that we like to use few non-directional strategies to play earnings. There are few things we like about those strategies: They are predictable. They are repeatable. They are flexible. They can be used on the same stocks cycle after cycle. The following article described few stocks that we use over and over again, cycle after cycle. We said "$TSLA, $LNKD, $NFLX, $GOOG: Thank You, See You Next Cycle".Well, the Next Cycle is already here. Click here to view the article
  6. Our long term followers know that buying premium into earnings is one of our favorite strategies. I wrote about the strategy in my Seeking Alpha article Exploiting Earnings Associated Rising Volatility. IV (Implied Volatility) usually increases sharply a few days before earnings, and the increase should compensate for the negative theta. We have been using this strategy in our SteadyOptions model portfolio with great success. However, not all stocks are suitable for that strategy. Some stocks experience consistent pattern of losses when buying premium before earnings. For those stocks we are using some alternative strategies like calendars. Click here to view the article
  7. In one of my previous articles I described a study done by tastytrade, claiming that buying premium before earnings does not work. The title of the study was "We Put The Nail In The Coffin On "Buying Premium Prior To Earnings". ​I demonstrated that their study was highly flawed, for several reasons (strikes selection, stocks selection, timing etc.) It seems that they did now another study, claiming to get similar results. Click here to view the article
  8. Hello. Has anyone ever tried purchasing straddles or strangles with expirations out 2 months or more (even out to near LEAPS time frame) and doing this around earnings time for very small gains with very limited theta decay. Alternatively holding these longer dated options through the earnings announcements? Thanks.
  9. Hello again. If I am looking for good post-earnings analysis right after the company makes its earning announcement then what site(s) do you think are the best. Perhaps flyonthewall, http://www.theflyonthewall.com/splashPage.php?action=main&arg=A Is it enough that if a company misses its earnings forecast then the stock will go down? Look at FNSR today. The stock went up despite missing earnings forecasts.
  10. As I write this I am pretty sure I already know the answer, but I was wondering if anyone has tried to this based on indicators like volume, OI, IV increase on just the Put or Call side, etc., and if they had any success? I know the IV crash would be a major issue with being directional anyway, but regardless knowing if anyone had any success in this area could be helpful. Thanks.
  11. Could some of the senior members and/or Kim comment on this idea? Does the IV (when it moves at all) on weeklies always outpace or at least stay even with the monthlies on the earnings trades? Could you then do the opposite of a calendar and long the weeklies and short the monthlies on an earnings trade? Take this hypothetical example: AAPL underlying @ 615 let's say its 19 July and the 27 July AAPL weekly is released. Let's say we have this made up pricing: 1. 27 July AAPL 615 Call @ $10.00 2. 27 July AAPL 615 Put @ $10.00 3. 17 Aug AAPL 615 Call @ $20.00 4. 17 Aug AAPL 615 Put @ $20.00 You would do this: long qty 2 of #1 long qty 2 of #2 (creating a straddle) short qty 1 of #3 short qty 1 of #4 I am sure the theta will kill you if you don't get an IV increase, so do this on a stock like AAPL probably would not work because of the high stock price (unless your portfolio is huge). Any thoughts on a trade that could take advantage of the greater IV increase in the weeklies? Thanks!