Johan
Ex got M3 in the divorce, waiting for EU Model Y!
Perhaps take a small amount and "roll backwards" to some more speculative shorter term calls (June 13) to get exposure to the possibility of a near-term further squeeze with at temporary high?
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Advanced TSLA Options Trading
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Perhaps take a small amount and "roll backwards" to some more speculative shorter term calls (June 13) to get exposure to the possibility of a near-term further squeeze with at temporary high?
It's not unlikely that Tesla will drop, so rolling locks in gains before that happens, if it happens, while still letting me participate in future rallies (or a continuance of this rally).
then I would roll those both up (and maybe out to J15), but take significant $ off the table; I've moved all the way to $80 now but those are J15; on J14 I'd move to a $60 strike or so
These strikes are so far out that the premiums look pretty steep. I'd lose more than half my profit rolling.
While volume is still very high, it's lower today than Friday, which was lower than Thursday. But, it still looks to me like the squeeze still has some legs. I guess I'll roll the dice another day.
Jonathan Hewitt
Active Member
Yeah, those huge premiums have been a huge discouragement to me in rolling. I've stopped rolling and my gains are just sitting in my brokerage account. I may be losing out a little on the upswing but I'm keeping a few options in so I don't have too many regrets.
FredTMC
Model S VIN #4925
yeah... I hoped vol today would've expanded and exceeded thu & fri. Looks like no such luck. Still huge vol (> 20m today). It's not like the vol has collapsed. Whew. Hoping the squeeze continues for many more days.
lets finish at high-of-day. Run into the close. Squeeze please !
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BTW, there are still some reasonable Naked Put selling opportunities. For instance:
Jan '14 $55 Puts will get you $6.30, for a 16.8% annual return, or buy the stock at $48.70.
The lowest buy price worth considering is:
Jan '14 $45 Puts for $3.20. A 10.4% return, or buy the stock at $41.80.
Towards the other end, if you wish you had bought TSLA at $60 you could try:
Jan '14 $77.50 Puts for $17.75. That's a whopping 33.6% annual return, or you buy TSLA at an effective $59.75.
While none of these are the biggest bangs for your bucks, if you wish you had more TSLA stock these are reasonable ways to either get it, or make some pocket change.
EDIT: I just sold a couple Jan '14 $77.50 Puts for $20.30. That's an effective buy price of $57.20, or a huge annual percentage return.
Jan '14 $55 Puts will get you $6.30, for a 16.8% annual return, or buy the stock at $48.70.
The lowest buy price worth considering is:
Jan '14 $45 Puts for $3.20. A 10.4% return, or buy the stock at $41.80.
Towards the other end, if you wish you had bought TSLA at $60 you could try:
Jan '14 $77.50 Puts for $17.75. That's a whopping 33.6% annual return, or you buy TSLA at an effective $59.75.
While none of these are the biggest bangs for your bucks, if you wish you had more TSLA stock these are reasonable ways to either get it, or make some pocket change.
EDIT: I just sold a couple Jan '14 $77.50 Puts for $20.30. That's an effective buy price of $57.20, or a huge annual percentage return.
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I'm in a margin account, so none. In a cash account, I'd need $5,720 for each contract, plus the $2,030 I just "made." Dividing those shows a 35.5% return for 10 months, or a 42.6% annual return.
In essence, I'm betting that $58 is about the new floor for the stock. That could easily be wrong.
I don't ever sell Puts on big up days, but this one trade just jumped out at me, given the high annualized return if held to expiration. If the stock tops near its current level, I'll probably be holding onto to these for a while, but buying more TSLA is something I'd like to do anyway, and right now a buy price under $60 doesn't look too bad.
We'll see where the post-squeeze levels end up. These Puts could be underwater real fast.
BTW, I usually split the bid/ask prices when trading options, but for these I pushed higher than midpoint thinking that they really wouldn't be bought. However, they were bought almost instantly. That tells me that there are a lot of TSLA bears with the stock at these levels, expecting to be able to hold out long enough for the stock price to eventually collapse.
EDIT: Arg! Woke up this morning, and apparently I sold $77.50 Calls, not Puts!!!! Trading options for a few years now and this is my first mistake!!! Guess that makes me an experienced trader now, eh? So, now I sold some Covered Calls, not Naked Puts.
I'm down a few hundred bucks with the stock at $90, but maybe I should keep sold Covered Calls as a hedge? If they get exercised, it's like selling TSLA at $97.50, which ain't bad at all. Thoughts?
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Just shows it's better to be lucky than smart. With the dip in TSLA, I'm now up $275 on each of those Calls! If anyone asks, just tell 'em I was hedging at the peak. ;^)
Citizen-T
Active Member
I'm thinking the hedge is a good play to keep- you already went long with selling those puts, and I'm personally of the persuasion that the short squeeze is going to relax for a while after this week. Some challenges coming for the market to absorb next quarter losses etc. I'll be biased to that opinion though as I acted on it and sold-closed all Calls taking the profit this morning at price stamp $90-$95. Holding just stock now, looking to reinter long calls around $75
Citizen-T
Active Member
Yeah, I'm inclined to agree. The worst that can happen with it is that someone makes me sell them my TSLA at $77.50, which when you factor in the $20.30 they already paid me gives me a net sales price of $97.80, which is higher than TSLA's all time high. So, I won't complain selling at that price. And if TSLA goes down or stagnates, I get to make some money as well - so it's a good hedge for me to keep at this point.
BTW, if TSLA does drop below $80 than rather than buying shares I'll be selling Puts (really this time). I already have a decent core position, so I'd be looking to acquire only at really good prices, or get paid for waiting.
It's weird that we're talking $60 as a good entry point for TSLA. Weren't we just talking $30 a few weeks ago? ;^)
weird indeed! and I'll be joining you on the put sell play after a pullback (coupled with some calls); I'd like to add some stock to core as well
ROFL. Congratulations in any case. I have been banging my head in frustration lately over the Jun13 65 covered calls I sold to "top up" my gains in mid-April. Bought back half of them today (afternoon), so now I have proper exposure to the stock again (which is probably the perfectly wrong timing, but I want to be long so there I go).
Yeah, TSLA now becomes a textbook case for why you shouldn't sell Covered Calls on high growth potential stocks.
ShortSlaver
Member
Yup. I've been saying for weeks selling covered calls is horrible with TSLA. There's plenty of other stocks out there that make sense for covered calls but TSLA is simply not one of them.
You want to sell calls, look to AAPL. It's not likely to pop and in fact very likely to dip and come back and dip for awhile. Selling covered calls is a good way to make some money while holding a long position that you plan on getting a decent gain from long down the road. Some weeks you'll lose but you'll win enough to make up for it very possibly. TSLA is just too full of quick potential to play around with selling covered calls.
Is TSLA a good Strangle candidate? I've got a Stangle Finder, and it suggested the following:
Expiration: June 2013
Call Strike: $100 for $6.20
Put Strike: $85 for $6.90
Break-even at $78.94, Downside Protection: 14.24%
Return if Unchanged: 7.43%, Return if Called: 11.75%
Annualized if Unchanged: 75.3%, Annualized if Called: 119.14%
Help me understand
a) What makes a good Strangle Candidate
b) How to interpret the above stats to decide which Strangle to enter.
Note that it also recommended a $105 Call with a $82.50 Put, both for June as well.
Expiration: June 2013
Call Strike: $100 for $6.20
Put Strike: $85 for $6.90
Break-even at $78.94, Downside Protection: 14.24%
Return if Unchanged: 7.43%, Return if Called: 11.75%
Annualized if Unchanged: 75.3%, Annualized if Called: 119.14%
Help me understand
a) What makes a good Strangle Candidate
b) How to interpret the above stats to decide which Strangle to enter.
Note that it also recommended a $105 Call with a $82.50 Put, both for June as well.
mershaw2001
I'm short the short sellers
Correct me if I'm wrong, but aren't you laying out 13.10 in cash and your break even points should then be 113.1 and 71.90? I don't think this is a good play, perhaps if you were to use spreads for each, going 100/110 and 85/65 you might be able to save some on the cost, but that 13.10 is a killer. I see all of your profit being erased by that cost. I don't see a move outside of 70 and 115 in the next 2 months, which is essentially what you need for this to be profitable.
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