The harder I work, the luckier I get. I will not discount the element of luck that went into cashing out some Friday Netflix calls a bit earlier.
It all started Wednesday afternoon…
I had the triple intraday confluence to work on the Nasdaq. Once I was able to scale off some futures I turned my attention to momentum stocks—to see if there was something I could carry overnight. Netflix had a nice, tight consolidation so I took Friday $110 calls around $1.40.
Thursday morning I had little intention of selling into the morning strength. I wanted to keep these calls for the FOMC minutes. As the morning progressed Netflix was hammered and down like 4% on the session. This rendered the calls I held nearly useless. I had room to add to the position so I entered a ‘stink bid’ down at $0.15, yep, 15 cents.
No more than 5 minutes later some chatter emerged that Netflix would raise their monthly subscription rate by a paltry dollar, a brilliant tax increase heading into the desolate winter. The stock went ape shit, reversed its loss, and trended high all day. I booked some late yesterday and the rest this morning. The overall gain was about 300%. The gain on those fifteen cent purchases was about 2500%.
The feeling of being on the right side of a fluke rumor? Priceless.
I want November calls in something now. Something longer duration. Maybe at the close. Maybe next week. I’m moving slowly today.Read More »