Options Brief: Netflix (NFLX)

NFLX – Netflix, Inc. – The provider of DVD-rental-by-mail service received a vote of confidence by one option strategist observed dabbling in July contract calls in the first half of the session. Netflix shares are up 0.76% to trade at $125.58 by 1:10 pm (ET) after earlier rallying 2.5% to an intraday high of $127.80 in morning trading. It looks like one bullish investor opted to roll a long call position to a higher strike price in the July contract. The trader appears to have sold 2,000 calls at the July $130 strike for an average premium of $5.78 each in order to buy the same number of calls at the higher July $135 strike for $3.98 apiece. The transaction, without knowing how much the investor initially paid to purchase the July $130 strike calls, results in a net profit of $1.80 per contract. The new long call stance prepares the responsible party to accrue added profits if NFLX shares surge 5.6% over today’s high of $127.80 to exceed $135.00 ahead of July expiration.

About Andrew Wilkinson 1023 Articles

Affiliation: Interactive Brokers

Andrew Wilkinson is the senior market analyst at Interactive Brokers Group, where he provides daily commentary and analysis on U.S. equity options trading throughout the trading day. Andrew provides webinars designed to explain option-related trading scenarios covering futures, fixed income, forex and equities.

Interactive Brokers: Interactive Brokers offers direct market access to around 80 electronic global markets from a single account. Successful traders and investors understand that superior technology and lower trading costs can result in greater returns. For 32 years we have been building direct access trading technology that delivers real advantages to professionals worldwide. With consolidated equity capital of US $4.4 billion, IB and its affiliates exceed 1,000,000 trades per day. In addition, our prudent and conservative risk policies make Interactive Brokers a safe haven for your money. Discover some of the reasons why IB, the largest independent US broker/dealer, is the professional traders' and investors' choice.

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