By Jon "DRJ" Najarian of OptionMonster

NEW YORK -- After Apple's (AAPL - Get Report) "Bendgate" controversy arose last week, I established a short position on the iPhone maker. 

I decided to use a put spread, as that carries much less risk than shorting the stock. So I bought the October 100 puts for $1.40 and sold the October 95 puts for 40 cents.  

That trade paid off quickly, as Apple shares fell from just shy of $103 to $97.72 in the next 24 hours.

I took profits on 50% of the position at that time, turning that $1 spread investment into $2 for a 100% profit. (The reason I took profits was my normal discipline of taking money off the table whenever a spread doubles).

The spread shrank back to $1.20 as shares rallied back up to $101.50, but I continued to hold it. 

As I said on CNBC Wednesday, my reasons for this position included supply and software issues, as well as the bending problem with the iPhone 6 Plus. And if hedge funds face redemptions and need to raise money, then Apple may be serve as their piggy bank -- and that could bring further pressure in the short term. 

On Wednesday, Apple dropped back below $100, down 1.56% to close at $99.18. Our October 100/95 put spread is once again very profitable, trading actively for $1.70, as our long 100 puts are going for $2.30 and our short 95 puts for 60 cents.

We still have 16 days until the October options expire, and the market hasn't shown much reason to be bullish, so I will hold this short position with a stop at my $1 entry cost. 

A version of this post appeared on InsideOptions Pro Wednesday.


This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.