Kevin Kelly of Recon Capital Partners recommended on Bloomberg Markets a bullish options strategy in Netflix, Inc. NFLX ahead of earnings.
The company is going to report earnings on Wednesday and Kelly wants to use a bullish risk reversal strategy to make money on the event. He wants to sell the January weekly, 128 strike put and buy the January weekly, 135 strike call for a total cost of $1.65. The trade breaks even at $136.65 or 2.83 percent higher. If Netflix drops below $128, Kelly is going to have to buy the stock at that price.
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