Communication Services
NFLX
Netflix Inc.
High premium income from Netflix (NFLX) covered calls and cash secured puts. Earnings volatility creates opportunity for premium sellers.
Monthly Premium2.0-3.5%
Annualized Return24-42%
Stock Price$850-950
IV RankModerate-High (45-65)
Options LiquidityVery Good
Dividend Yield0%
Why NFLX for Covered Calls & Cash Secured Puts?
NFLX offers good premium due to earnings volatility and streaming competition narrative. The stock has proven its business model with password sharing crackdown success.
Example Covered Call Trade
NFLXCovered Call
Strike Price$950 (8% OTM)
Expiration30 days
Premium$25.00 per share
Return If Flat2.8% ($2,500)
Return If Called10.8% ($9,500)
Keep Probability68% keep shares
Recommended Strategy for NFLX
Sell calls 8-12% OTM to allow for NFLX's growth spurts. Avoid holding through earnings unless comfortable with 15%+ moves.
Risks to Consider
- Expensive to own 100 shares (~$90K)
- High earnings volatility
- Streaming competition
- Content costs
- Subscriber growth questions
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