Wiki Selling TSLA Options - Be the House

[Jim Holder]

Frisky action on TSLA today! I’m sure the millions in $300 strike call buying are helping it along. Plus dealer positioning still showing quite bullish until 7/28/23, then bearish through end of September.

Question is do we sell longs here at around $296 and wait for correction to re-buy, or hold out for $300-$313?

TA says hold and wait. Stoch is strong and downward supports are not broken.

What are you guys doing?

 

[Cherry Wine]

Frisky action on TSLA today! I’m sure the millions in $300 strike call buying are helping it along. Plus dealer positioning still showing quite bullish until 7/28/23, then bearish through end of September.

Question is do we sell longs here at around $296 and wait for correction to re-buy, or hold out for $300-$313?

TA says hold and wait. Stoch is strong and downward supports are not broken.

What are you guys doing?

I have opened relatively small hedges in the form of some September dated long puts at $180 (really, this is nothing more than disaster insurance) and have some January 24 short calls at the $400 strike, as well as $360 short calls expiring this Friday. With those in place, hold and wait has the most appeal to me at the moment.

 

[Knightshade]

I sold a similar amount of -$342.50C at $1 earlier today, currently down 10% but not sweating that much (so far)... also sold a smaller amount of CSPs -257.50 for $1.50, those are up almost 20% (all Friday expiration)

Just as update, closed the puts at 50% profit a minute ago... PROBABLY I could've held to close just fine, but if earnings are bad enough to knock 15% off the SP in a day I figure they'd have to be bad enough to let me open something even better without having 6 figures in cash locked up securing those puts.

All the short calls remain open (and down about 20% now) but still pretty unconcerned there

 

[stealthyc]

E-trade margin interest is 12% on accounts under $500k though, wouldn't going into margin for treasuries lose you money?

That margin interest is negotiable.

 

[adiggs]

I am so jealous. Congratulations. There is more important things than money and watching a stock every day is not really that fun.

I own some VUSXX Vanguard Treasury Market Fund with a yield of 5.06% right now which should be really safe. Or buy some AT&T it is at the lowest price since 1993 but pays a 8.19% dividend .

I've augmented my own cash holdings with cd's up to 1 year in duration. I have built a CD ladder with enough expiring each quarter to pay for the next quarter's living expenses. I have had as many as the next 4 quarters setup this way, and intend to maintain at least 2 -- so I have some leeway when I need to raise and deploy the living expense money.

Best cd I have right now is 5.2%, so its not a whole lot better than other market funds, but it has that additional characteristic that I have to give something up in order to access it.


(not-advice!)
In the spirit of dividend paying investments, I found Fundrise awhile back and have been very pleased with them. I've got some money in an income fund and mostly get 2% each quarter as a dividend (8% / year). Not guaranteed, but reasonably stable. I would like to replace the CD ladder with about $1M here - that'll get me most of the quarterly living expenses on an ongoing basis, with very little effort needed to keep an eye on the bank account balance and grab more now and again when those quarterly expenses exceed what this real estate investment produces.

 

[juanmedina]

I closed my -270p's for a $8 win. If we rally after ER I will let some of my low $200'cc get call away and sell some puts on Tesla or Spy.

 

[juanmedina]

Here is Troy's estimates:

https://twitter.com/x/status/1681424236064243712

 

[Jim Holder]

Here is Troy's estimates:

https://twitter.com/x/status/1681424236064243712

Hmmm…he’s predicting a margin miss. Given he was off with the “cars sold” numbers for 23Q2 I imagine he would be extra careful to get as close as possible to accurate numbers here so that he’s not wrong twice in a row, which makes it more ominous.

I wonder how TSLA will react to 16% vs 18% if it’s indeed true. Recent price action and dealer positioning shows a bullish posture and supports a run past $300, so a bit of a nail-biter.

 

[MikeC]

Hmmm…he’s predicting a margin miss. Given he was off with the “cars sold” numbers for 23Q2 I imagine he would be extra careful to get as close as possible to accurate numbers here so that he’s not wrong twice in a row, which makes it more ominous.

I wonder how TSLA will react to 16% vs 18% if it’s indeed true. Recent price action and dealer positioning shows a bullish posture and supports a run past $300, so a bit of a nail-biter.

I’m a little nervous about margins since Ferragu’s note last week. But I don’t think it’s logical to infer that because Troy was off on deliveries, that he therefore has some way to be more accurate on margins than he otherwise would have been.

It also may not matter. Q1 and Q2 2022 had great margins but TSLA was still punished because the market was forward-looking.

 

[Jim Holder]

I’m a little nervous about margins since Ferragu’s note last week. But I don’t think it’s logical to infer that because Troy was off on deliveries, that he therefore has some way to be more accurate on margins than he otherwise would have been.

It also may not matter. Q1 and Q2 2022 had great margins but TSLA was still punished because the market was forward-looking.

You make a good point.

If the market is forward-looking, then we should be okay to test $314 or higher from here. Though dealer positioning shows from July 28 onward until September is quite bearish, so maybe a brief spike and sell off (especially as $300+ bag holders unload having waited so long). Difficult call.

Most dealer supported prices are in the box:

This Friday's Dealer Greeks buildup is quite bullish:

GEX levels show 315 top and 300 support (+GEX/Green resists; -GEX/Red supports):

GEX levels on the chart:

 

[WattsHappening]

Hmmm…he’s predicting a margin miss. Given he was off with the “cars sold” numbers for 23Q2 I imagine he would be extra careful to get as close as possible to accurate numbers here so that he’s not wrong twice in a row, which makes it more ominous.

I wonder how TSLA will react to 16% vs 18% if it’s indeed true. Recent price action and dealer positioning shows a bullish posture and supports a run past $300, so a bit of a nail-biter.

I'm trying to not get too optimistic about earnings and margins tomorrow. But I would be VERY disappointed if auto GM comes in at 16%. If it does, I would expect a big sell-off, like 8-10%. Basically give back all of the gains since the P&D numbers surprised to the upside.

I'm expecting 18%, hoping for 19% with a message that margins have bottomed and are expected to rise going forward. And holding onto that tiny sliver of wishful thinking of 20%+.

 

[Knightshade]

Here is Troy's estimates:

https://twitter.com/x/status/1681424236064243712

You link no longer works and I'm seeing a different post on Troys twitter?

https://twitter.com/x/status/1681432630842253312

He also posted a summary of other estimates here:

https://twitter.com/x/status/1681428023634198532

Interesting Troy is the only one not above WS consensus

 

[Jim Holder]

You link no longer works and I'm seeing a different post on Troys twitter?

https://twitter.com/x/status/1681432630842253312

He also posted a summary of other estimates here:

https://twitter.com/x/status/1681428023634198532

It seems like he updated it between. Originally it said 16% as his estimate. It seems like he updated it in between.

Here’s a screen-cap from the original:

 

[Knightshade]

It seems like he updated it between. Originally it said 16% as his estimate. It seems like he updated it in between. Originally it said 16% as his estimate.

He swapped out automotive GM for total GM.... He also changed the consensus from "wall street" to the wall street (company compiled) one that was 2 cents lower.

 

[juanmedina]

Rob's forecast:

 

[Patrick66]

Feels like too much optimism for me right now. I expect a lot of the narrative on the Cybertruck to be that Tesla will need to sell it at a loss to get their volumes, wait until the price drop, etc. The earnings report I don't stress as much over (no short term calls right now); I can see a strategic case for Tesla to keep earnings flat, and I can see an optimistic case that production efficiency has improved massively to help margins... but I can't see a universe where they will exceed 18.5%. Just a gut feeling.

 

[SebastienBonny]

Feels like too much optimism for me right now. I expect a lot of the narrative on the Cybertruck to be that Tesla will need to sell it at a loss to get their volumes, wait until the price drop, etc. The earnings report I don't stress as much over (no short term calls right now); I can see a strategic case for Tesla to keep earnings flat, and I can see an optimistic case that production efficiency has improved massively to help margins... but I can't see a universe where they will exceed 18.5%. Just a gut feeling.

Feel the same. Don’t know how the situation is in other countries, but if you often check the inventory cars, you’ll see these are sold with massive discounts:

- Model 3: -4000 to -6000
- Model Y: -2000
- Model X & S: -7000 to -8000

These are inventory cars of course, so need to see the whole picture, but just saying that only taking the price cuts in your calculations won’t be enough…

Considering price action I suspect a sell off after earnings, since we had a big run up into earnings and that tends to trigger sell off after. Whatever they may be.

 

[vikings123]

When did this thread turn into a earnings discussion thread? Come on guys let’s keep it on topic

 

[Max Plaid]

So, I have 54x -c270's for this week, which look like they'll free-roll to -c280, but as 30x of these are underwritten with put shares I'm going to buy back 30x and sell the shares and then sell 30x -p280 for this week with the capital

Seems to me that chasing up weekly calls for premium is hard for the moment, so will increase my put exposure, currently 30x to 60x - don't forget I have the 30x Jan 2024 +p250's as a safety-net, so I can be a bit extravagant with the number of puts

ITM/ATM calls, I just want to keep rolling up and up, that's fine if I don't make any extra on those for the moment

I have no idea where we land after earnings and wouldn't like to proffer any opinions TBH, your guess is as good as mine, and both likely to be wrong

Edit: update, actually better for me to let the 30x -c270 exercise on Friday as it gives me some realised gains, which will hep me regulate the EOY taxable situation, which I like to keep fairly consistent

Edit 2: I'm stupid, buying back the calls and selling the shares will give the same profits as the shares will sell ATM and not the 270 strike... pfff

 

[Jim Holder]

@dl003 Are you still planning to sell longs at $296 and observe, anticipating correction to $230-$217 to get back in, and if TSLA doesn’t reject at $296 to hop back in for ride to $340?