5/31/2021 Plan:
This week we look at a popular streaming service, Netflix (Ticker: NFLX)
5/31/2021 Plan (continued):
- NFLX- Sell the Jul 16th 460/450 put spread for 1.35
- INTC – Sell the Jul 2nd 53.5/51.5 put spreads for 0.23
- JWN – Sell the Jun 25th 28.5 put for 0.28
- Prices are as of market close 5/28/2021, actual fill and strikes may differ depending on Monday’s open, post will be updated accordingly.
- All trades are for educational purposes and do not constitute advice
5/31/2021 Commentary:
This streaming video thing. Could be big. š. I have been a Netflix subscriber since having to return DVDs in red envelopes. I like the service and I think they have developed a decent moat that not too many others can challenge. Lots of people will keep their NFLX And add Disney+ and a couple others. This trade assumes NFLX maintains support above 460 for the next six or so weeks. A bit longer on the trade but also a good return. Note it is 10 points wide, so size accordingly.
If folks missed AMD last week, the INTC trade is a chip play for a few weeks.
Last, a put play in JWN for those willing to hold shares – a good return to take shares at a much lower level. Iām looking at several other put sales this week, including the DKNG 40 put expiring Jul 2 for 0.40.
Feel free to Reach out with questions on this or anything else!
6/1/2021 Entry:
Sold NFLX Jul 16 455/445 put spread for 1.39. INTC Jul 2 53.5/51.5 for 0.23. JWN up significantly. No put sale. I may look at the 30 strike later in the week or if there is a sell off, revisit the 28.5.
6/6/2021 Update:
The NFLX put spreads are worth 1.45, so we are down a few pennies on the trade. Lots of time still and no action planned for a bit. A decision point will be if NFLX closes below 480. I would consider dropping the trade if that occurs.
The INTC put spreads are profitable – worth 0.19/spread. No planned change to this position this week, we’ll look to capture more premium.
6/13/2021 Update:
With a long time to go on the NFLX put spreads, we’re up a few dollars per spread. We will sit tight and let some more time pass and more decay (ideally) occur.
The INTC put spreads could probably be closed for 0.05 or 0.06 – not a bad idea if you need to free up margin and can re-allocate to another trade. We still have a few weeks, so we’re only collecting a couple dollars a week. I will probably put in an order for 0.03 or 0.04 and see if it gets filled
6/20/2021 Update:
The NFLX put spreads are now worth 0.60 at the midpoint, a nice winner so far. I’m leaving it on a bit longer to try and capture more decay, particularly with the short strike $45 out of the money
The INTC put spreads can be closed for 0.13 at the midpoint, but more likely it would take about 0.24 to close. Basically flat on the position. I’m holding, but if there is a lot of follow-through on Friday’s drop, be prepared to close for a small loss rather than letting it turn into a big one. If you want to remove risk from your portfolio, you can simply close it for a scratch this week.
6/27/2021 Update:
The INTC put spreads are worth only 0.04 and can be closed at any time. Reminder they expire this week – so close them out if you want to avoid the risk of being assigned.
NFLX made a nice move up making our put spreads pretty safe and are now worth only 0.13. These can be closed to book a big win or held to try and squeeze a bit more premium over the next few weeks. It is only $4/week, so keep in mind that you have $1k of risk for just a few dollars reward per week.
7/5/2021 Update/Partial Close:
The INTC Put spreads expired completely worthless, bringing in $23/spread of profit
The NFLX put spreads have continued to decay as they are Far out of the money. Now worth just 0.06 or 0.07. Close and book the win or hold for a very small return. if you are light on margin, definitely close these out.
7/11/2021 Update:
The NFLX put spreads expire this week and are effectively worthless. Close them for 0.01 or 0.02 or you can let them (likely) expire worthless at the end of the week. This is a nice win of $139/spread for our accounts.
7/17/2021 Close:
The NFLX put spreads expired worthless, for a $139 winner. These were Very far out of the money, but as mentioned last week, freeing up the margin for just a few cents is fine.
