DailyPlay – Closing Trade (NFLX) – September 12, 2023

Closing Trade

• NFLX – 54.16% Loss: Sell to Close 2 Contracts (or 100% of your Contracts) Oct 20th $415/$360 Put Vertical Spreads @ $8.70 Credit. DailyPlay Portfolio: By Closing both Contracts, we will receive $1,740 We initially opened 1 Contract on Aug 16 @ 15.72 Debit, and then another Contract on Aug 18 @ $21.60 Debit. Our average loss, therefore, is $996 per contract. 

Investment Rationale

After 3 straight quarters of revenue declines for AAPL, today’s event marks a critical moment that investors have been looking forward to. With the launch the iPhone 15, Watch and iPad updates will likely be offset by any concerns of slowdown in consumer spending and further contagion risk with China. The event will not likely result in meaningful volatility unless there are surprise announcements with VisionPro or new products. Additionally, if we look at a chart of AAPL relative to its sector XLK, we see that it has already printed a new 52-week low a few days ago. This shows poor relative strength going into the event, signaling distribution of the stock ahead of it. We are going to keep our hedge on AAPL while our NFLX position has crossed the threshold for cutting losses and warrants closing out the full position after initially breaking below our $415 support level