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Playing NFLX

Jan. 28, 2011 11:21 PM ETNFLX
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As some of you may know Netflix came in and beat estimates handily Wed night.  We picked up OTM calls on the name that afternoon and cashed them out this am for the following gain (less than 24 hours):

# January 27, 2011
# 06:33 | Bagger Vance NFLX ($209.00) Sold to Close NFLX FEB 200 CALL Feb 200 calls, at $15.00 +159%

Just a fantastic gainer in a short period of time.  They don't always work out like this but we take 'em down when they do.  We're off to a FLYING start in 2011, some of the new members have told me so already.  Just ONE trade like this, say 2 contracts at 5.70 each would have earned you nearly 2K altogether - a fantastic win.  Would you have done this on your own?  Perhaps.  Perhaps not.  I can tell you that many who are members did get on the trade and posted the solid winner.  How to get involved?  Sign up RIGHT HERE and you're good to go.  The above trade would have paid for many many months.  Look forward to having you come aboard!

This was tweeted from Turbo516 yesterday: Looks like $NFLX is still going strong! Thanks, awesome call....if this keeps up, 200C could be a bagger tomorrow!!

We often find after the Fed meeting the true market reaction to the decision.  Well...YAWN.  Markets gave a collective sigh and didn't budge, sentiment still rather complacent with the VIX hanging around 16 or so.  The put/calls were elevated on the day showing there is some angst.  Oil was down a bit as some middle eastern violence in Egypt caused a stir.  Bonds were strong as the news of a Japan downgrade could not deter buyers.  Earnings in the am were rather strong and in the evening we heard from AMZN, which seems to have disappointed.  Commodities took a rest as well - coal, energy, steel were down but earnings from POT and a split pushed that one higher.  Some big earnings in the am (HON, among others) should pace the action.   The next five days are generally in the best bullish trend of the year (see below).

Hit 'em straight!


The broad stock market rallies at the end of January, into early February, nearly every year. In fact, it does that
at the end of most months, but the end-of-January seasonal period is the strongest of the year. It seems to arise
from the fact that, often, institutions have not put enough of their new inflows of year-end cash to work as the end
of January draws nigh. But they feel it must be invested by month-end, so that it shows up on their month-end
reports. So they buy at that time.
Specifically, in the 25 years since 1986, this strategy of buying at the close of the 18th trading day of the year
and selling at the close 4 days later, has been extremely profitable. On average, SPX has risen 8.3 points in those
four days (an average gain of 1.2%). There have been profits in 21 of the 25 years.

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