Advanced TSLA Options Trading

[neroden]

Options are a contract for purchase/sale at a date and at a price. That's all. If you speculate on them that's your gambling. Once a buyout offer comes and is confirmed the options will behave as if it's expiration date and stock price is the buyout price. You lose all time value.

I'm so glad my main options trades were selling put options at low strikes. I also have a few calls at low strikes. I think I'll sell one tomorrow; the other one, I was holding to execute, so I'm hoping to figure out how to raise the cash for that soon....

 

[mrwuffles]

I'm so glad my main options trades were selling put options at low strikes. I also have a few calls at low strikes. I think I'll sell one tomorrow; the other one, I was holding to execute, so I'm hoping to figure out how to raise the cash for that soon....

Nice! I considered this, but did my first options trades this week and didn't have enough in my account for if they put it back on me. Didn't want to risk it.

 

[oneday]

I'm so glad my main options trades were selling put options at low strikes. I also have a few calls at low strikes. I think I'll sell one tomorrow; the other one, I was holding to execute, so I'm hoping to figure out how to raise the cash for that soon....

@neroden Not only do I owe you thanks for all of the information and insight you provide here. You also really influenced my decision to buy DITM calls. With TSLA possibly going private now, I sure am glad that 90% of all my calls are DITM. Thank you sir!

 

[Revhappy2]

Hi guys, I quickly learnt what is iron condor and did this trade to hedge my position.


-1 400 CALL $10

+1 420 CALL $6.8

-1 300 PUT $11.70

+1 280 PUT $7.87

Hi Guys,

What happens to my Iron condor now? They all expire on 19 Oct 2018.

 

[pz1975]

Hi Guys,

What happens to my Iron condor now? They all expire on 19 Oct 2018.

If the private sale goes through at $420 before Oct. 19 (unlikely), you will be down about $1,300 ($700 cash you collected - $2,000 you will owe to close the $400 call). If it happens after Oct. 19, you will probably still be down around $1,300 depending on how the market rates the odds of the sale at $420.

Considering the questions you have asked in this thread (all of which should really have been in the basic options thread), my advice to you would be to only trade very, very small amounts of $ in options in the future until you have done that for at least 2-3 years and truly understand their power. MANY of us here in this forum had to learn the hard way how dangerous options can be for the uneducated.

 

[GSSREDDY]

Hi Guys,

What happens to my Iron condor now? They all expire on 19 Oct 2018.

I think your 300 PUT will be trading a low value and you can "buy to close" the PUT

The Call spread (400/420) will cost you about $15 to close it

 

[PaulusdB]

Hi Guys,

What happens to my Iron condor now? They all expire on 19 Oct 2018.

I think your 300 PUT will be trading a low value and you can "buy to close" the PUT

The Call spread (400/420) will cost you about $15 to close it

Let’s call it a not-so-bargain tuition fee.

 

[Revhappy2]

If the private sale goes through at $420 before Oct. 19 (unlikely), you will be down about $1,300 ($700 cash you collected - $2,000 you will owe to close the $400 call). If it happens after Oct. 19, you will probably still be down around $1,300 depending on how the market rates the odds of the sale at $420.

Considering the questions you have asked in this thread (all of which should really have been in the basic options thread), my advice to you would be to only trade very, very small amounts of $ in options in the future until you have done that for at least 2-3 years and truly understand their power. MANY of us here in this forum had to learn the hard way how dangerous options can be for the uneducated.

Should I close all my positions tomorrow? Why isnt TSLA already trading at 420 now? Since the news is already out, it should be priced in immediately?

 

[pz1975]

Should I close all my positions tomorrow? Why isnt TSLA already trading at 420 now? Since the news is already out, it should be priced in immediately?

Probably a good idea to close the call portion as it will likely be cheaper tomorrow than when the SP goes to $420. You can likely leave the puts to expire worthless.

 

[Marsnaut]

Should I close all my positions tomorrow? Why isnt TSLA already trading at 420 now? Since the news is already out, it should be priced in immediately?

There is a chance that the deal doesn't go through. There is always uncertainty with corporate actions including this one. As we get closer to a deal materializing, the price should consolidate closer to $420.

 

[oneday]

Seeing as all options over $420 dropped off a cliff, I’m thinking I’ve developed a trading strategy for tomorrow.

Lotto tickets!!

I think the short squeeze is actually going to happen. I give it maybe 25% chance of happening in the next 3 months. So I’m looking to buy some $425 calls. They have huge bid ask spreads as of close, so I don’t know what they will be tomorrow but assuming they’re only a couple $ per contract in the oct nov time frame. Seems like a gamble that could pay off if we see a squeeze.

Obviously, I know the risk is high that these expire worthless.

Thoughts? Anyone have some calls they are going to try to pick up tomorrow?

 

[InvestWithEdge]

I bought 2020 Jan calls ($300 strike price) a while back. I am guessing I can use them to buy the stock before the deal closes. Any suggestions?

I also bought 2020 Jan puts to protect downside for my existing stock position. I might either sell them or let them expire worthless. any suggestions here?

What are you all doing with your calls and puts?

 

[K_Dizzle]

Is anyone looking at calls in the recent dip? Personally I picked up some jan 19 $330s on Friday. Depending on TSLAP does I might convert a ton of these into shares.

 

[bdy0627]

Is anyone looking at calls in the recent dip? Personally I picked up some jan 19 $330s on Friday. Depending on TSLAP does I might convert a ton of these into shares.

Yep. I currently prefer the J19 $360s, but these are now well OTM so the strike is pretty aggressive.

 

[K_Dizzle]

Yep. I currently prefer the J19 $360s, but these are now well OTM so the strike is pretty aggressive.

That is pretty aggressive, I hope they don’t stay out of the money for much longer though. I think the shorts have untill Q3 is finished and the deliveries are reported to inflict maximum carnage to the SP.

 

[neroden]

That is pretty aggressive, I hope they don’t stay out of the money for much longer though. I think the shorts have untill Q3 is finished and the deliveries are reported to inflict maximum carnage to the SP.

I'll continue to say that the shorts will keep on going until Q4 numbers are reported.

 

[Akspai]

Hi guys need some advice, I got into a short PUT position of strike 300 Jan 2020 for $59, last friday and then the stock tanked. Now I am looking at MTM loss of 1K. The news over the weekend is not very inspiring also the VIN numbers is a saving grace. I could make this a cash secured PUT and ride it till expiry and the max loss in case of BK is 4% of my network. What would your advice be?

 

[mershaw2001]

I am looking at slightly in the money calls, switching about 1/2 of my portfolio to the jan 280 or 270 strike.

 

[Mario Kadastik]

Well selling OTM put spreads has backfired hard on this 1.5 week drop of >100... Lost a bunch on Friday where they dropped from OTM to ITM in a gap down and while I managed to move some further out I'm pretty maxed out with margin now as most spreads are ITM and the call spreads I picked up on the way down are losing value hence squeezing the margin as well. Do have to tell I didn't anticipate such a huge carnage on the stock price, assumed it might bounce around 350-360 region, but not 280...

 

[AlMc]

Well selling OTM put spreads has backfired hard on this 1.5 week drop of >100... Lost a bunch on Friday where they dropped from OTM to ITM in a gap down and while I managed to move some further out I'm pretty maxed out with margin now as most spreads are ITM and the call spreads I picked up on the way down are losing value hence squeezing the margin as well. Do have to tell I didn't anticipate such a huge carnage on the stock price, assumed it might bounce around 350-360 region, but not 280...

. UGH!