Geeze, yeah debit call spreads.
Thanks for the catch!
(Even typed it wrong in this reply, must be the alliteration)
-
Want to remove ads? Register an account and login to see fewer ads, and become a Supporting Member to remove almost all ads.
Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Thanks for the catch!
(Even typed it wrong in this reply, must be the alliteration)
If you want to take on more risk with near term options, a case can certainly be made that the $1,500s or $1,800s expiring in September offer a lot of leverage. I personally have never done any large short term trades (0.1-0.5% of portfolio usually), but have not had much success with them, and living in Asia I sleep during most of market trading, so it also makes it more difficult. Therefore, I'm not sure I'll ever make any short term trades again, but although risky, these options could pay off if S&P inclusion happens after Q2 ER, and if the squeeze is big enough.
Regarding long term options expiring Jun'22, unless you think the SP will very likely be >$3,000 by then, I'd stick to safer ATM or ITM strike prices. The Jun'22 $2,000s are trading @ ~$24k right now (~20 shares), and would perhaps be worth double that, or slightly less, if SP goes to $3,000. The Jun'22 $1,000s are trading @ ~49k right now (~40 shares), and would probably be worth 1.75x or 70 shares if SP goes to $3,000. Considering the $1,000s come with far less risk, I think those are looking much better than the $2,000s right now, unless you have high conviction that SP will end up at much more than $3,000 in the next 2 years.
Last edited:
Apparently it's all about the delta, right?
So ITM LEAPS will grow faster than OTM's, is this the case? Been selling too early then
My June 2022 $1250's cost me 100 shares worth 3 weeks back, now they're worth 133 shares, that's pretty decent return, I'd say and I expect them to be ITM soon. My strategy to date has been to sell once they hit 2x original value, then buy something on a longer strike for the same price. I've not scientific basis for that, just seemed like a good idea
Although we've had a run, I think there's plenty more to go. I had originally thought $1500 by year-end, if the stars-align then I'm revising this to $1750 and then $2500 mid next year.
Maybe I can split the strategy - Indeed September $1500's look pretty cheap to me, but October strikes would get the benefit of the Q3 P&D, which I'm pretty sure will be "shock and awe" for the street. The $1500's are $90, 10 of those would be a good bet, might even be ITM after the earnings...
Faster initially, but there are many factors involved (risk, relative growth, high end value). For instance, you can buy more OTMs for the same price as ITMs. Were the stock to go super high, each option turns into 100 shares (Delta of 1). So more is better. If you roll pre expiry, then some initial OTMs can still be better.Apparently it's all about the delta, right?
So ITM LEAPS will grow faster than OTM's, is this the case? Been selling too early then
I like Options profit calculator
for running senarios.
I've been running some numbers using Options Profit Calculator. I looked at the September 18 1500's but didn't like the returns. I'm liking LEAPS a lot more, even if selling out early after a strong rise. The other option is a bull call spread, which also looks very good from an outlay to return perspective:
Note profits are including short and long term capital gains tax using AU tax rates.
Note profits are including short and long term capital gains tax using AU tax rates.
I've expanded out the table above to include the Sept 18 1500C option along with the comparitive performance of purchasing shares of equivalent value to the options purchased:
Maybe OT, but have you tried the same strategy with other stocks. I have some tech stocks for which I am tempted to try selling puts.
I am so in-tuned with TSLA news and near/long-term milestones that I can make informed decisions, but not with other stocks. I might still try selling OTM puts and see how it turns out.
I am so in-tuned with TSLA news and near/long-term milestones that I can make informed decisions, but not with other stocks. I might still try selling OTM puts and see how it turns out.
I bought some $NCLH $80 Jan 2022 calls for fun after talking to colleague at work - just $2k worth though. Cruise stocks will soar the moment they start sailing again.
Otherwise no - I understand $TSLA, I know the company and product intimately, I can make far better informed decisions as a result.
I have a colleague who fiddles about with 30 or so different stocks, buys and sells for 10% gains...
I rolled my position to a higher strike again @1328 (a bit later than I would have liked but I was at the graduation of my daughter when the market opened, and that is way more important).
Premiums are crazy high and so are the spreads. I bought back 10 puts 1100 for 31 July @37.00 (which I had sold @91.30 last week) and sold 10 puts 1300 for 7 August @126.00, for a total premium gain of $89,000. But ofcourse my obligations increased too.
Premiums are crazy high and so are the spreads. I bought back 10 puts 1100 for 31 July @37.00 (which I had sold @91.30 last week) and sold 10 puts 1300 for 7 August @126.00, for a total premium gain of $89,000. But ofcourse my obligations increased too.
pz1975
Active Member
I started my funnel strategy for the next 2 weeks a little early with the big price move and subsequent IV rise. I sold 1050 puts for July 17 and 2000 and 2250 calls for July 24. Those last 2 I sold for $12 and $8 each, respectively. Seems like a win-win as I either pocket the premiums or if the SP goes to those crazy numbers, my underlying shares + LEAPS are up a crapton.
Good lord - I didn't realize call premiums for that far OTM were that high.
Maybe I need to reevaluate selling some covered calls...
It is weird to think that the July and August puts I sold Wed or Thurs last week are ready to be reevaluated after today for a new position.
I'm thinking some new 7/24's at higher strikes than I'll be closing - and maybe a really high strike that's begging for exercise ahead of earnings.
Or maybe I'll just buy a few calls for the earnings. I'm historically bad at option buying, but I did buy an Aug 1400 last week that doubled in value today; so maybe I'm learning a little bit and moving up slightly from bad (still a long ways in the hole, looking only at option purchases).
To add on - the July 24's are showing IV nearing 100% (.96 I think it was) for the ATM IV. The 2250s seem so far out of reach for July 24 that it might be some good money. I figure this is the primary reason 2250's are selling for such a high premium so far OTM. I would probably restrict selling any of these to an IRA as I'll trigger some hefty tax consequences outside of that.
And this is one example of why I started this thread. I wasn't even looking at calls, any strike, any expiration. I should have been - the only reason I would buy the 2250 strike for 7/24 would be with the intent of selling it before expiration; I don't expect it to be ITM in that short of a timeframe.
So somebody else provided me info that has me thinking and plotting.
Wish I read this before pulling the trigger. Sold a 07/24 Put@995 for $84. Now it went up to $95.
Oh well, stock will definitely be above that after P&D report, so I have time to close.
Closed this position today for $10.5 for a profit of about 8K. Total profit since starting with 2 puts on June 6th is 17K. Not bad for first month of writing puts!
Date
So first time, sold a covered call, expiring this friday 07/10, 1800c for 6$. I hope the sp does not go to 1800 in next 4 days, right?
I can see IV skyrocketing in option positions I have. I bought a call last week (Aug 1400). Share are ahead $4 and the call is up $14.
The puts I've sold are up (bad) so far, despite the share price going up.
"Call premiums are very high (@ 100% IV)" @Right_Said_Fred
cc: @Lycanthrope @adiggs
To the carpenter, everything looks like a nail. Yet everything is not a nail.
Yesterday we had a 13.48% move in the underlying.
That's a single day realized vol of 13.48*16= 216%
If you don't hedge everyday (most people don't), over the past week and a day we had a 42.9% move in the underlying.
That's a single week realized vol of 42.9*7.2= 309%
Now is NOT the time to write premium past earnings.
cc: @Lycanthrope @adiggs
To the carpenter, everything looks like a nail. Yet everything is not a nail.
Yesterday we had a 13.48% move in the underlying.
That's a single day realized vol of 13.48*16= 216%
If you don't hedge everyday (most people don't), over the past week and a day we had a 42.9% move in the underlying.
That's a single week realized vol of 42.9*7.2= 309%
Now is NOT the time to write premium past earnings.
Are you only referring to now NOT being the time to write premium on Calls? I would think it is the ideal time to be selling the premium on puts.
Similar threads
