When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.
Tech Alert - Netflix, Inc. (NFLX) – BUY
BUY the Netflix, Inc. (NFLX) September 2022 $247.50-$252.50 in-the-money vertical BEAR PUT spread at $4.05
Opening Trade
8-30-2022
expiration date: September 16, 2022
Portfolio weighting: 10%
Number of Contracts = 24 contracts
This is a bet that NFLX will stay below $247.50 in the next 17 days.
Just like I have been telling you - jobs are rolling over and that means lots of firings in tech companies. And how do we know that? In Jackson Hole, Wyoming, Fed Governor Jerome Powell told us that there will be “pain” and to expect a softening job market.
The Nasdaq hasn’t priced in a hard landing yet and in the short-term, the market will need to navigate the concept of how strong the job market is since it’s the last pillar, cited by the Fed, that the economy is standing on.
One of the first discretionary services to get cut will be dreadful products like Netflix (NFLX) whose content quality has fallen off a cliff.
Someone needs to fire the content quality control over there.
I am inclined to sell every large rally in NFLX until the Fed pivot.
Here are the specific trades you need to execute this position:
Buy 24 September 2022 (NFLX) $252.50 puts at………….………$28.00
Sell short 24 September 2022 (NFLX) $247.50 puts at………….$23.95
Net Cost:……………………...............................…….………..…….....$4.05
Potential Profit: $5 - $4.05= $.95
(24 X 100 X $.95) = $2,280 or 23.46% in 17 days
If you are uncertain on how to execute an options spread, please watch my training video by clicking here.
The best execution can be had by placing your bid for the entire spread in the middle market and waiting for the market to come to you. The difference between the bid and the offer on these deep in-the-money spread trades can be enormous.
Don’t execute the legs individually or you will end up losing much of your profit. Spread pricing can be very volatile on expiration months farther out.
Keep in mind that these are ballpark prices at best. After the alerts go out, prices can be all over the map.
