Our calls on Netflix (Nasdaq: NFLX) continue to hand us quick profits.
This past Tuesday, we bought calls after Netflix reported earnings that exceeded our parameters — triggering a trade. Yesterday, we locked in a nice 50% gain on the first half of the position.
And now, just three days after entering the trade, the last half of our position is already up by the triple digits — we’re now sitting on a 130% gain.
So, as I mentioned yesterday, we’re going to adjust our stop-loss order higher to lock in a greater gain. Instead of protecting 10% of our profits, we’re going to protect 100% as this position continues to climb.
Keep in mind that the trade directions below are based on our official entry price of $3.98. So be sure to place your stop-loss order at whatever price nets you a 100% gain based on your individual entry price — and just remember to use a stop-loss order. Otherwise your trade could be triggered right away, and we want to ride this rally higher.
Here’s the action we’re taking:
|Action to Take|
|Sell Action to Take|
|Stock:||Netflix Inc. (NFLX)|
|Option Type:||Call Option|
|Action:||Sell to Close|
|Order Type:||Stop-Loss Order|
|Duration:||GTC (Good ‘Til Canceled)|
|Trade Deadline:||Keep this order open until it is filled or canceled.|
Some of your 100% stop-loss orders may be triggered sooner than others based on your entry price — but that’s OK. You’re still walking away with a 100% gain on the last half of the position and a 50% gain from the first half — netting you a 75% overall gain.
We’ll continue to keep you updated on this trade, and if the calls keep rallying, we may adjust this stop-loss higher. Just keep an eye out for my alerts.
Hope you have a great weekend.
Until next time, good trading…
Editor, Earnings Drift Alert