how's it going everyone this is Ryan
from Marriott lifestyles today I want to
do a weekly wrap up for everyone on just
how the markets went you know we had a
looking bearish this week but there was
plenty of opportunity especially if
you're trading options so I'm gonna
share a trade I did in my real account
but I'm gonna use my paper trading
account to you know demonstrate for you
guys so I did a trade on Netflix on
Monday the previous week Netflix had a
high of what was it one thirty one
twenty three so that was a that was a
definite bullish day and but on Monday
the market was coming down and Netflix
came from 131 all the way down to 123 so
that was a huge down move huge down move
and you know Netflix being a market
leader one of the strongest stocks right
now holding the market up you know I
decided that I'm gonna be a contrarian
in the short term perspective this is a
huge down move in one day I think we're
gonna get a nice little bounce here so I
decided to sell a put a put spread in
here I actually sold this put spread
when Netflix was at 1:22 so I almost
caught the bottom which was basically
pretty pretty lucky but that's not what
I cared about there was a nice pop and
volatility so Netflix being higher in
volatility I decided you know what
there's uh I could definitely collect
some premium in here so I was able to
sell the 1:15 which you can't even
market on the chart this is 118 right
here let me go on a 20/20 debut so I was
able to sell the 115-112 put spread
okay because I believe that Netflix was
not gonna breach 115 you know I ended up
being right and within the next day
Netflix pop backed up to 128 that's
where I closed out my put spread I was
able to collect 60 cents which is
equivalent to 60 dollars on this spread
and I closed it out for 50% profit so 30
I collected $30 per contract so two
things were working my favor
I took a contrarian mindset and I sold a
put way down here price went up that
worked in my favor and volatility came
down which also worked in my favor
because I sold something that was a is
it expensive and I bought it back for
cheaper and I want to show you um show
you how that works so you know next week
if if Netflix comes down a little more I
might sell another put spread in there
so I'll just go over to the options
chain to show you what I mean I let this
load let's go a month out you give us
enough time to be right that's another
thing I always give yourself at least 25
to 30 days to be right okay you could
probably sell the 112 in here 112 put
let's see how much it'll create a spread
how to put I'm selling the 112 all by
the let's do the 108.50 k we can
probably tighten up the spread a little
bit okay we'll just do this for
demonstration purposes I'm collecting 92
cents so x $192 we're gonna go to
spectral analysis to analyze the IV rank
so this is
implied volatility which is at 46 which
is relatively high compared to you know
the average or actually the 52 week low
is 24% we're at 46% so there's a nice
pop in volatility let me show you guys
what happens when volatility comes down
okay I'm gonna set this up let's just
pretend we put in this trade today I'm
gonna set the date to Monday and I'm
gonna keep the price of the same okay
I'm keeping the price the same my on
down 13% on this trade okay
I'm keeping the price the same but let's
say volatility comes down on Monday
let's just cut it in half
for instance okay I'm done 13%
volatility comes down now I'm up 29% so
I definitely want to stress that fact
that volatility is very important when
trading options okay so when volatility
is high you're gonna want to sell
options instead of buy because if you're
buying options you're buying fear and
fear is expensive so that's the point I
wanted to prove on this video and I hope
everyone has a great weekend take care
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