NFLX Earnings trade

NFLX reports their quarterly earnings on Monday Oct 16th after the market closes. One interesting speculative play is to add a small out of the money call fly that can work if NFLX has an up move after the earnings release.

Currently it looks like the expected move by the market-makers is about $16. With NFLX trading around $196,  I would enter the following trade:

OCT 20th Expiration

Buy 1 200 call
Sell 2 210 calls
Buy 1 220 call

Enter as a butterfly spread for around $1.50 per spread

The trade is profitable on expiration from about $201.50 to $218.50. Close at whatever profit you can get on Tuesday Oct 17th.

Mark Fenton

options trading courses

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