If you agree NET’s rally will continue, consider the following trade that relies on the stock remaining above $85 through expiration in five weeks. Buy to Open NET 19MAR21 80 Puts (NET210319P80)
Sell to Open NET 19MAR21 85 Puts (NET210319P85) for a credit of $2.35 (selling a vertical) This credit is $0.05 less than the mid-point of the option spread when NET was trading near $86. Unless the stock rallies quickly from here, you should be able to get close to this amount. Your commission on this trade will be only $1.30 per spread. Each spread would then yield $233.70. This trade reduces your buying power by $500 and makes your investment $266.30 ($500 – $233.70). If NET closes above $85 on March 19, both options will expire worthless, and your return on the spread would be 88% ($233.70 / $266.30), or 915% annualized.
As with all investments, you should only make option trades with money that you can truly afford to lose.
Happy trading,
Terry | 
