SebastienBonny
Member
Capital gains only matter when you're selling at or above your avg cost base. I don't know if that's the case for @OrthoSurg.
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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Yes, we have a survivor bias here of the members still alive here but even so, with significant losses too.
I was about to go into spreads when everything went crazy. I would have zero money left instead of 30%
SebastienBonny
Member
Yes, but you're right.
Even if you're selling below your avg cost base (like I'm doing right now), you shouldn't only look at premiums when you're rolling a contract. A strike improvement will cut your losses should you get excercised as well.
The main news is a Reuters article that the Model 3 will be revamped with lower cost and revised features for a Q3 2023 relaunch. There's also Tesla launching in Thailand in December.
Looks like my CC are in for a rough time.
SebastienBonny
Member
Look at it this way: I'd rather roll my CC's up and out knowing my stock goes up again, than the opposite.The main news is a Reuters article that the Model 3 will be revamped with lower cost and revised features for a Q3 2023 relaunch. There's also Tesla launching in Thailand in December.
Looks like my CC are in for a rough time.
Is there really market excitement over a Q3 2023 rumor? If there was going to be excitement about anything I would have thought the Semi. But could also be the recovery effect from holding the price down on Friday?
Anyway, I rolled my 12/2 195 CCs to 12/9 202.50 for a modest credit. Likely could have done better if I waited an hour, but somehow it's never sunk in to not do anything during the first hour of Monday trading. I'll keep trying to tell myself that. Timing aside, I'll be OK if these exercise before EOY since sadly I have the short-term losses to offset the long-term gains. I guess we'll see.
The good news is that each time Elon sells I do a bit better at managing it. I'm pretty much flat for November. Not what I'd like for a month, but way better than I would have feared.
I still haven't gotten over a rush of anxiety every time we're down in premarket... Just from those "down 5% WTF" days that seemed to crop up way too often. So I should probably say my balance is flat for November... but I'm still a bit mentally scarred.
Anyway, I rolled my 12/2 195 CCs to 12/9 202.50 for a modest credit. Likely could have done better if I waited an hour, but somehow it's never sunk in to not do anything during the first hour of Monday trading. I'll keep trying to tell myself that. Timing aside, I'll be OK if these exercise before EOY since sadly I have the short-term losses to offset the long-term gains. I guess we'll see.
The good news is that each time Elon sells I do a bit better at managing it. I'm pretty much flat for November. Not what I'd like for a month, but way better than I would have feared.
I still haven't gotten over a rush of anxiety every time we're down in premarket... Just from those "down 5% WTF" days that seemed to crop up way too often. So I should probably say my balance is flat for November... but I'm still a bit mentally scarred.
Thanks for the inspiration STO 10x 2/12 -c195 @$2.25
As expected, 5x -c180 exercised from Friday, these were shares from -p185 assign, so all good, just de-risking a little
And Semi deliveries on Thursday / Elon's 500mile TweetThe main news is a Reuters article that the Model 3 will be revamped with lower cost and revised features for a Q3 2023 relaunch. There's also Tesla launching in Thailand in December.
Looks like my CC are in for a rough time.
Yes, we're becoming battle-hardened over time
Biggest difference for me was to be able to manage the reversals - we popped up 10% last week from the low, in the past I would find myself on the wrong side of the trade and unable to recover, end up with big weekly loss, this time I still turned a profit, albeit fairly modest
As mentioned many times recently, the key for is not to bed the farm, just put 10-20% of shares or cash at risk, then you have room to manoeuvre...
AimStellar
Member
Margin call due to covered calls going ITM?
On Thursday I had 7 figures + of margin available. On Friday I received a margin call for $55K.
I made no moves in between, and the only portfolio move of significance was my covered calls (this week 177.5 strike) going ITM.
Does anyone understand the mechanics of this?
It’s not a lot, but since Fidelity technically “reserves the right” to meet margin calls at any time, I want to address and learn from it now, as I don’t ever want them to reach into my portfolio and sell positions.
My cost basis on the shares is far lower than the strike sold.
On Thursday I had 7 figures + of margin available. On Friday I received a margin call for $55K.
I made no moves in between, and the only portfolio move of significance was my covered calls (this week 177.5 strike) going ITM.
Does anyone understand the mechanics of this?
It’s not a lot, but since Fidelity technically “reserves the right” to meet margin calls at any time, I want to address and learn from it now, as I don’t ever want them to reach into my portfolio and sell positions.
My cost basis on the shares is far lower than the strike sold.
EVNow
Well-Known Member
Have you bought anything on margin ... ? Otherwise it makes no sense. BTW, you can take a look at detailed account balance .... should tell you something.
EVNow
Well-Known Member
As noted, spreads are better if you are hedging. But using spreads to increase leverage obviously increases risk.
Still thinking this? I'm hovering over selling CC's @ $200 for next Friday as SP shows signs of peaking.
I'd call and have them explain it to me. For both Fidelity and eTrade, I have a platinum 24/7 team I can call. If you have 7 figures of margin, you should have this as well.
It's been awhile since I've looked into this, but in my recollection covered calls have different margin requirements as they move ITM.
Another thought is that my first broker - Robinhood (lol) - sometimes screwed up pairing the long leg against a short position, ie., they would pair a deep OTM long call instead of an ITM long call, creating a credit spread instead of a debit spread.
Well today was interesting. China news had me completely freaked out last night. Needed ambien to sleep. Panicked and sold some shares pre-market at 179. Obviously a bad decision, but gives me breathing room if we drop again. Made up for some of the loss by selling 175 Puts for Friday that I can roll down and out if sp reverses this week, so I would rebuy the shares much cheaper.
Nio also looking good today, so China situation must not be as bad as I fear….
Nio also looking good today, so China situation must not be as bad as I fear….
Think China shutdown was priced in on fifteen different past trading days over the past three weeks.
Don't forget, Tesla put its cash pile to work stockpiling for supply chain snags. Supposedly has 70 plus days ready to produce. Maybe the market acknowledging this?
Doubtful. I am going to go with TSLA is so oversold it could not go down short term anymore without true force majeure.
Getting buffeted about lately? Me too.
Usually I say to roll early when credits are still to be had as opposed to later. But obviously this is your call.
No I think that scenario is dead. I'm still thinking 185 on Friday was top of wave 1 although it does look like 187.5 premarket on Friday can be used as the top too.
Still thinking we are in the correction / consolidation wave 2. It's normal to have wave B of 2 extend 1.236x beyond the starting point of wave A. 188 vs 185 is a bit of a stretch but if we use 187.5 PM on Friday as the top of wave 1 then not so much. Notice how we got rejected by the 30m 200 EMA right at the upper edge of the falling wedge. Breaking out of this wedge will be very bullish for the stock.
Also keep in mind we reclaimed the weekly 200 EMA at 187.5 and held it for a bit before giving it up. Closing the week above 187.5 will be very bullish as well.
What the price action this morning tells me is that the deterioration of China public order had been somewhat priced into TSLA and played a role in the continuous slide from I don't know how high. When news of protest hit the media yesterday, instead of jumping into shorting more, shorts decided it's time to cover their TSLA position at 179. However, we're running into the first strong resistance which is the upper edge of the wedge and weekly 200 EMA.
However, this price action tells me wave B of 2 is not done yet.
If we use 187.5 premarket Friday as the top of wave 1 then wave B of 2 can go up to 190. November PCE report comes out PM tomorrow which can act as the catalyst for this final spike. I will reconsider my count if we can close the day above 190 as something else must be going on. However, regardless of what happens, I'm still standing by my call for 195 as minimum retracement for wave 1.
On Wednesday at noon, Powell will give a speech. SPY has a tendency to get crushed on the days when he speaks. Knowing this, I think (a) big boys don't want to give retail shorts a chance to profit off TSLA on Wednesday so they're squeezing them now and (b) this further affirms that 166 is the bottom.
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