I'm curious if that many options would have a market moving impact? Do you sell them all at once or in batches? I notice the SP change direction when I simply BTO ~10 call contracts while trying to catch a falling knife.
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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
I'm curious if that many options would have a market moving impact? Do you sell them all at once or in batches? I notice the SP change direction when I simply BTO ~10 call contracts while trying to catch a falling knife.
Rolled the 04/16 775C to 04/23 860C at almost even (a very small credit), near closing time today.
Curious as to your timing? Since they were not even close to ITM, why not wait for more time decay before rolling, especially since there was basically no credit in the roll? Just wondering about the thought process, so I can learn.
I closed some of my 775's today for a tiny profit. I might keep the rest for tomorrow but I only got $3-2 of premium for them so it might not be worth the stress and having to watch the stock all day tomorrow. I also don't feel like rolling them for a tiny premium and I rather close them for a lost and have a shot at a nice premium with a safe strike next week. Today it could have been a really green day and sometimes is better to get out while you can. I think everyone would risk manage their positions differently. After the market closed yesterday I kind of regretted not closing my positions .... it is a coin toss when the SP is so close to the strike.
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Continuing in the theme of slight risk for "better than nothing" premium, I rolled both sets of CCs down to 40 x $805 ($.55). Booked $3,100 for the initial trades above with another possible $2,200 for the roll-down. Not big money by any means, but I'll take $5K a week with little risk. I've been successful selling margin covered puts way OTM for comparable amounts, but will strategically sell CCs on weeks where it is pretty clear there's not a lot of risk (this week's giant $800 call wall providing a nice buffer for calls at or above that number). I appreciate the continued thoughts and guidance from this thread and all the participants.
Clipped and rolled 850p 04/16 to 850p 04/23 for a $2.3 credit. Feels good to start to unwind that side of the strangle. Clipped about 50% of the accumulated sold premium (~110/contract clipped).
Had debated rolling in to earnings week, but figured the extrinsic value in to that week won't drop very much through next week given IV will likely keep climbing on those.
I am also almost done accumulating my leaps, at which point I will go back to buying shares with sold premium.
Current positions (excluding B&H shares):
Had debated rolling in to earnings week, but figured the extrinsic value in to that week won't drop very much through next week given IV will likely keep climbing on those.
I am also almost done accumulating my leaps, at which point I will go back to buying shares with sold premium.
Current positions (excluding B&H shares):
- Sold 850p 04/23/2021 - intend to resize this, once I get an OTM expiration, to be more balanced with covered calls, currently 1.3:1 ratio of puts to calls;
- Sold 1200c 03/17/2023 - will unwind this opportunistically, to bring it back closer in time and strike price, as it was my way of getting out of a margin call;
- Bought 800c, 850c, and 900c 03/17/2023;
Put another way:
If free/unallocated cash [in a marginable account] is greater than the margin requirements for the sum of the account positions, one generally won't have to pay margin interest. Note that there may be a need for the trader to identify the trade(s) as cash vs margin in the trade ticket(s).
If one does not have enough free cash to cover the margin requirements for all of their trades and instead they have to use margin to make up the difference (also referred to as 'leverage'), they are charged interest. Generally the interest will only be applied to the difference--the amount of margin the position(s) requires beyond the account's free cash. If in the future one allocates free cash to a new/modified position or frees up more cash by closing/modifying a position, the account's 'interestable' margin will change accordingly.
Rolled my 5/14 bought calls this morning to 5/21's
Sell to close @ $700
Buy to open @ $760
Net credit of $24.50 per contract and more time premium to play with and some cash for a possible YOLO for next week.
Looking at 4/23 buy to open $750's (IV is only 54 on these) looking for a $15 entry and hold till Monday/Tuesday
Edit - buy to open 5 x $750's for 4/23 @ $15 each
Sell to close @ $700
Buy to open @ $760
Net credit of $24.50 per contract and more time premium to play with and some cash for a possible YOLO for next week.
Looking at 4/23 buy to open $750's (IV is only 54 on these) looking for a $15 entry and hold till Monday/Tuesday
Edit - buy to open 5 x $750's for 4/23 @ $15 each
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I assume you are equating unallocated cash with buying power in the marginable account? Because you can certainly sell naked puts using your buying power as collateral, with essentially 0 free real cash.
No. I am equating unallocated cash with 'margin' that doesn't require you to pay margin interest.
Of course, as long as you have enough leveraged margin free to cover the position’s margin requirements.
I rolled my $680 Puts up to $715 for $6.4 extra premium each. I didn't touch my $805 and $830CC's, will look to see how Friday trading starts before considering a roll.
That is ballsy! I'm making peanuts on the options because i'm doing far OTM lol. But I do see your reasoning behind it.
jeewee3000
Active Member
Thanks to all who responded to my earlier post.
Started going through the Options course in the opening post of this thread, but so far haven't learned anything new. Will keep at it though, just to be as informed as possible.
This post hit so close to home I've got to thank @bxr140 for it. I guess I'm not ready for The Wheel yet in the sense that I really don't want my shares called away. Therefore I'm going to start off with selling CC's against B&H shares, so VERY defensive and ready to roll with lot's of backup shares to split the risk.
Dipped my toe in the pool by selling (to open) a 4/23 900c @$1,7 premium on the 'peak' of yesterday's trading. I know, this is a low premium, but it's also very low risk and that is what I'm going for during 'training'.
I won't sell over the ER, that's just too crazy for a beginner like me. But by May I think I'll be ready to bridge the time to AI day by selling CC's. In the meantime, just lurking/learning/paper trading calls.
GLTA
Started going through the Options course in the opening post of this thread, but so far haven't learned anything new. Will keep at it though, just to be as informed as possible.
This post hit so close to home I've got to thank @bxr140 for it. I guess I'm not ready for The Wheel yet in the sense that I really don't want my shares called away. Therefore I'm going to start off with selling CC's against B&H shares, so VERY defensive and ready to roll with lot's of backup shares to split the risk.
Dipped my toe in the pool by selling (to open) a 4/23 900c @$1,7 premium on the 'peak' of yesterday's trading. I know, this is a low premium, but it's also very low risk and that is what I'm going for during 'training'.
I won't sell over the ER, that's just too crazy for a beginner like me. But by May I think I'll be ready to bridge the time to AI day by selling CC's. In the meantime, just lurking/learning/paper trading calls.
GLTA
I always buy back my CC rather than let them just expire. Removes any doubt and avoids the risk of someone exercising after hours on a spike. I normally set them to 0.01 or 0.02. At 0.05 your 805CC should already be closed by now.
I'm with IB and the commission to buy back options is less than 1USD each. In Belgium they charge 1.50EUR. Some other brokers let you close cheap calls for free.
You should really look at moving your trading portfolio from your bank to a cheaper broker. With the number of trades you're doing the commissions would add up to a significant sum. I used to be at a bank that charged similar for options but moved and haven't looked back.
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Ok, now that’s really ballsy! Edit: Recent price action looks to me like a bunch of big dogs are fighting it out for $730-735. Perhaps you are now one of “them”.
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That's a sound strategy. The good news for you is that in general, selling options is most efficiently implemented as a low-aggression, conservative strategy. If one is going to make agressive trades, one will realize more gains with lower risk buying options instead.
bkp_duke
Well-Known Member
Yeah, I was about to ask the same thing. Stock price is rocketing, along with calls.
Makes me really appreciate E*TRADE and their $0.50/contract fee, and they don't even charge the fee when closing at/below $0.10.
4 wins today.
Sold CC 750.
- Moved to 740 this noon when SP was hovering in the 730s. Survived the sudden 749-740 scare this afternoon and the rush up to 739.78 in the closing minute. Won by 22 cents.
Sold IC 670/675/800/805.
- Minor scare during the runup to 780+ on Monday, but the 800 call wall was too high, so no panic there since Tuesday.
Sold -p720 to start my Wheel.
- Wheel started! Phase 2 may be 800 CC next week.
Sold IC 715/720/750/755 at noon today.
- SP was stuck in the 730's. Might as well get some shopping money.
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