Wiki Selling TSLA Options - Be the House

[BornToFly]

TBH and completely blunt, you are crazy not to have an accountant, could save you 20x the fees.

My taxes have always been very simple. We don't own a business. It's just W2 from work, and gains/losses from Fidelity on 1099 (and some real estate K1 investments).

The CPA would have to submit different gains/losses and wash sales than what Fidelity submits to the IRS. I could see that triggering an audit....

What is rubbing me raw is that I used Fidelity YTD (year to date) gains/losses back in December to make sure I was negative. How were they off by $1 Million in Gaines?!?

 

[ShareLofty]

I plan to hold all of them for years,

No you don’t.

Proof? Had I gone to cash at $358 and bought back at $102…thats a 3.5x move right there (358/102=3.50)! It’s also not the reckless “timing the market” if you do it with a rational and clear system. Lookup Pierre’s YouTube videos where he teaches it.

Haha you can’t be serious! 3.5x for guessing the top and the bottom. You make Pierre sound like a prophet. If he was that good he’d be a billionaire by now and not wasting his time posting YouTube videos.

 

[MP3Mike]

What is rubbing me raw is that I used Fidelity YTD (year to date) gains/losses back in December to make sure I was negative. How were they off by $1 Million in Gaines?!?

Did you have no wash sales transactions after you checked? (All the way up to January 31st.)

Wash sales are a nasty thing...

 

[BornToFly]

We were looking so good in Pre-Market.

Hopefully we get a strong reversal after some profit taking/short selling....

 

[juanmedina]

Any thoughts on this? A P&D miss was destruction for the SP last time. I am think about selling some and maybe buying some protection. I wonder when will the China issues get fixed.

https://twitter.com/x/status/1630576133967151105

I sold 230-240cc for Friday yesterday and sold some $250's for next week. I would love for these CC's to get in trouble. At work they laid off 80% of my coworkers in my group last Friday and I am thinking about early retiring frugally and I need some cash.

 

[bkp_duke]

My taxes have always been very simple. We don't own a business. It's just W2 from work, and gains/losses from Fidelity on 1099 (and some real estate K1 investments).

The CPA would have to submit different gains/losses and wash sales than what Fidelity submits to the IRS. I could see that triggering an audit....

What is rubbing me raw is that I used Fidelity YTD (year to date) gains/losses back in December to make sure I was negative. How were they off by $1 Million in Gaines?!?

Have you called and talked to a Fidelity rep? I've found them very knowledgeable and helpful.

 

[dl003]

We were looking so good in Pre-Market.

Hopefully we get a strong reversal after some profit taking/short selling....

After a 110% run, it's dangerous to think it's the shorts who have more profits to take here.
We have had multiple macro reading: CPI, PPI, CPE, unemployment etc... all pointing to inflation being sticky and the odd of a 50 bps raise in March has risen from 1% just 2 weeks ago to over 36% last time I check. The wind is against stocks now.

 

[Jim Holder]

After a 110% run, it's dangerous to think it's the shorts who have any profit to take here.

Can you share an update of what you’re seeing for top and bottom and any option plays?

 

[BornToFly]

After a 110% run, it's dangerous to think it's the shorts who have more profits to take here.

I meant to say that is it traders taking profits after yesterdays gains, and new short sellers getting into the game with new selling after the run up.

 

[dl003]

Can you share an update of what you’re seeing for top and bottom and any option plays?

My read is still the same - this is a dead cat bounce before the second leg down. It's has run up further than I thought but the next leg down in inevitable.

 

[mongo]

My taxes have always been very simple. We don't own a business. It's just W2 from work, and gains/losses from Fidelity on 1099 (and some real estate K1 investments).

The CPA would have to submit different gains/losses and wash sales than what Fidelity submits to the IRS. I could see that triggering an audit....

What is rubbing me raw is that I used Fidelity YTD (year to date) gains/losses back in December to make sure I was negative. How were they off by $1 Million in Gaines?!?

I think YTD is purely cash/ account liquidated value based, it won't compensate for wash effects or basis pre-Jan1.

 

[BornToFly]

Did you have no wash sales transactions after you checked? (All the way up to January 31st.)

Wash sales are a nasty thing...

This is most likely the problem. I did have to roll BPSs in the first week of January when the stock was just over 100. It must have conflicted with trades I had done in December....

 

[dl003]

My projection for the month of March is still the same. Weakness till the week of 3/17 as we have CPI and FOMC on tap in the same week. Then, a *real* bounce.

 

[Right_Said_Fred]

Any thoughts on this? A P&D miss was destruction for the SP last time. I am think about selling some and maybe buying some protection. I wonder when will the China issues get fixed.

https://twitter.com/x/status/1630576133967151105

I sold 230-240cc for Friday yesterday and sold some $250's for next week. I would love for these CC's to get in trouble. At work they laid off 80% of my coworkers in my group last Friday and I am thinking about early retiring frugally and I need some cash.

Personally I'm not very worried about P&D. Sales in the US and Europe appear to be brisk and China will probably also have a good quarter.

It's the earnings report that I fear.

Giving up approx. $7,000 of the $9,500 average profit per car with the steep price drops is a huge profit loss to overcome. I'm not sure if cost savings, IRA income and extra Megapack profits can make up for much of that loss. Going from $4.1 billion profit in Q4 to - say - $1.5 billion in Q1 may not go down well with the market. So that's making me cautious, at least for the next few months.

The situation around China (possible arms sales to Russia and the economic response that could provoke from the West) does not increase my risk appetite.

 

[mongo]

Giving up approx. $7,000 of the $9,500 average profit per car with the steep price drops is a huge profit loss to overcome. I'm not sure if cost savings, IRA income and extra Megapack profits can make up for much of that loss.

Don't forget reduction in supply costs (beyond efficiency cost savings).
As of Feb 6th, Tesla vehicle US prices were mostly higher than they were in 2021. Tesla had 22% GM ex-credits then.
Rob Maurer:

 

[dl003]

This is most likely the problem. I did have to roll BPSs in the first week of January when the stock was just over 100. It must have conflicted with trades I had done in December....

This is too late and it hurts to see how you are getting screwed over on taxes after a horrible year, but there are a few things we can consider when thinking about selling shares to meet emergency needs:

. If you have a portfolio margin account, instead of selling shares, you can buy DITM puts against the number of shares you need to sell. It will "lock in" the stock price at that moment and your margin will go up similarly to a sale. You can then withdraw the money or, in the case of needing to sell to deal with a margin call, settle the call. You can keep these DITM puts for as long as you like or until they expire. A few thing are going to happen: if the stock recovers and you want to "buy" these shares back, you can sell the puts at a loss, but in reality you've regained control of your shares by paying more in the form of that loss, instead of having to pay capital gain tax on the shares. If the stock keeps dropping and at some point you want to "buy the dip", you can also sell the puts for profit and only pay taxes on this gain instead of long term capital gain tax on the shares.

. Unrelated to your situation, but I've sold all of my taxable shares last year in the 100s AND bought $5 calls expiring June 2023. Since these are shares I acquired after 2020, their cost basis was much higher than 102. I was able to harvest a ton of losses on this sale to offset against my option profits and save on taxes equal to 18% of the value of my account while retaining 100% of the delta for the ride up.

 

[BornToFly]

. Unrelated to your situation, but I've sold all of my taxable shares last year in the 100s AND bought $5 calls expiring June 2023. Since these are shares I acquired after 2020, their cost basis was much higher than 102. I was able to harvest a ton of losses on this sale to offset against my option profits and save on taxes equal to 18% of the value of my account while retaining 100% of the delta for the ride up.

Did you wait 30 days to buy the calls, or assumed they were different enough from the shares...?

 

[dl003]

Did you wait 30 days to buy the calls, or assumed they were different enough from the shares...?

I use IBKR and apparently they were different enough from the shares for IBKR. So, I bought them seconds after the sale. Just got my 1099 and am delighted.

 

[john tanglewoo]

No you don’t.

Haha you can’t be serious! 3.5x for guessing the top and the bottom. You make Pierre sound like a prophet. If he was that good he’d be a billionaire by now and not wasting his time posting YouTube videos.

Who is Pierre?

 

[dl003]

Who is Pierre?

Where is Pierre?