Netflix Q4 Earnings In Focus In The Options Market

Netflix Inc NFLX is scheduled Thursday to report its fourth-quarter earnings. Shares of the streaming service company have lost almost 14% year to date.

On CNBC's "Options Action," Tony Zhang said the stock traded nearly 1.3 times its average daily volume on Wednesday.

“But the market is currently implying about a 7.5% move versus the 6.2% that we’ve seen over the last sight quarters. [It’s a] fairly substantial deviation,” Zhang mentioned.

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There was a buyer of 725 of the January / March 500 straddle swaps for an average price of $25.88 per contract, he said.

The trade implies the stock may rise or fall substantially by March but may not move significantly on earnings.