Wiki Selling TSLA Options - Be the House

[Max Plaid]

@Max Plaid and other options seller pros here, when we are at a top and about to retrace down $20-$40, does it make sense to STO a bunch of covered -C500 12/2026 LEAPS (pays around $25) with the plan to BTC short term at the next low to capture gains from the drop or are there better options?

I'm thinking -C LEAPs because they have decent delta (0.31) yet still leave plenty time to fix things in case SP goes the wrong way (and $500 in 2026 is a far way off).

Here's an example projecting out the next several months on 20x -C500 12/2026:

View attachment 992730

Ha ha, I'm no pro, just been doing it for a while now and still screwing up regularly!!

I'm not really into selling long-dated positions except as a mechanism for getting out of trouble, but I can see the rationale behind it. Of course the risk is that the SP blasts through the resistance and your contracts get tied-up for months or even years

But I've also noticed that when you have extreme volatility, the long positions can be as profitable as weeklies, but without the pending expiration and stress that brings

I would say to try it out, see how it works out and more importantly how it makes you feel - we need to be comfortable with our trades to that emotions don't trip us up

 

[Jim Holder]

If you want to play a near-term drop, wouldn't it be simpler to just buy short-term puts? You have to pay the initial premium but that's better than risking 100 shares you don't want to lose and possibly having to sit on a contract for the next 2 years.

Yes, true. Was wondering what most do here and if there's another way to accomplish same synthetically without putting up money to buy puts which decay on you, whereas short calls decay in our favor.

 

[Max Plaid]

Still holding -p230's and -c250's for this week, with Only 1.5 trading days left after today I'm letting them ride for the moment

 

[MikeC]

Yes, true. Was wondering what most do here and if there's another way to accomplish same synthetically without putting up money to buy puts which decay on you, whereas short calls decay in our favor.

I understand that as an option seller you don't like to pay for premium, but I've come around to the view that I should consider all available tools to get the result I'm looking for. Sometimes it's the right move to spend a few hundred bucks on a play rather than tying up $24,000 (100 shares) to make the same amount of money.

 

[ninpb]

Lately been selling ITM puts as day trades. Thought it finally caught up to me last week with 11/24 -P 230s and 240s but was able to close them today for 40% and 70% profits.

 

[Max Plaid]

So, it's a big beat from Nvidia EPS $4.02 versus $3.37 expected, Revenue $18.12 versus $16.18 expected

Weird initial reaction with the stock dumping - and TSLA with it, but recovering now

 

[dl003]

It might look weird, but the 25% runup in 3 weeks had to count for something lol.

 

[dl003]

This is certainly a very nice beat, but valuation aside, when market does not respond positively to a piece of good news, maybe it's time for that correction.

 

[CHGolferJim]

Still holding -p230's and -c250's for this week, with Only 1.5 trading days left after today I'm letting them ride for the moment

Me, too, on the -c250. Oddly, roll credit for 1Dec$260 has improved slightly since yesterday despite the $5 SP gain. Prefer to let $250 expire and sell $260 Monday to get >$1.50 vs. $0.94 on the roll. Unsure what the credit growing means, but suppose it’s related to market thinking $250 on Friday is unlikely.

 

[tivoboy]

This is certainly a very nice beat, but valuation aside, when market does not respond positively to a piece of good news, maybe it's time for that correction.

First, yes it was a BIG run up on the past couple weeks, but 2nd, I think the concern is the NEXT beat and it doesn’t appear that it will be as large - even the company is indicating it won’t be.- although they have a history if putting up a solid estimate and then BEATING.

But, bring it back to Tesla.. one thing that really does concern me for Tesla going into next year Is the issue of Production and Delivery ESTIMATES and BEATS. The market is so used to the ESTIMATES being increase 100%, then the following year increase 50%, then 40%, well what if Tesla comes out in early Jan 2024 and says their projection is going to be 20-25%? They don’t want to NOT beat an estimate, but macro, sector, cyclical and YES TESLA related we’re going to slow before POSSIBLY surging. That concerns me how the market is going to react to that.

I sold 5x -cc245 for THIS week @3.05 today, I’m happy if they get taken EOW..

Still haven’t picked my spot for buying puts for 12/1 or 12/8 or BOTH, but I like that everyone seemed to jump in on +p225 or +p220 for one of those expirations. Makes me think we’re on to something.

Has anyone else read this book? I read it about 20 years ago and found it fascinating.

Amazon.com

 

[Cherry Wine]

Me, too, on the -c250. Oddly, roll credit for 1Dec$260 has improved slightly since yesterday despite the $5 SP gain. Prefer to let $250 expire and sell $260 Monday to get >$1.50 vs. $0.94 on the roll. Unsure what the credit growing means, but suppose it’s related to market thinking $250 on Friday is unlikely.

Theta burn gets really high as you approach expiration. In this case, the theta > delta.

 

[Jim Holder]

Like clockwork

Judge finds evidence that Tesla, Musk knew about Autopilot defect

(Reuters) -A Florida judge found "reasonable evidence" that Tesla Chief Executive Elon Musk and other managers knew the automaker's vehicles had a defective Autopilot system but still allowed the cars to be driven unsafely, according to a ruling. Judge Reid Scott, in the Circuit Court for Palm...

finance.yahoo.com

(Reuters) -A Florida judge found "reasonable evidence" that Tesla Chief Executive Elon Musk and other managers knew the automaker's vehicles had a defective Autopilot system but still allowed the cars to be driven unsafely, according to a ruling.

Judge Reid Scott, in the Circuit Court for Palm Beach County, ruled last week that the plaintiff in a lawsuit over a fatal crash could proceed to trial and bring punitive damages claims against Tesla for intentional misconduct and gross negligence. The order has not been previously reported.

The ruling is a setback for Tesla after the company won two product liability trials in California earlier this year over the Autopilot driver assistant system. A Tesla spokesperson could not immediately be reached for comment on Tuesday.

"This opinion opens the door for a public trial in which the judge seems inclined to admit a lot of testimony and other evidence that could be pretty awkward for Tesla and its CEO," Smith said. "And now the result of that trial could be a verdict with punitive damages."

The Florida judge found evidence that Tesla "engaged in a marketing strategy that painted the products as autonomous" and that Musk's public statements about the technology "had a significant effect on the belief about the capabilities of the products."

Scott also found that the plaintiff, Banner's wife, should be able to argue to jurors that Tesla's warnings in its manuals and "clickwrap" agreement were inadequate.

The judge said the accident is "eerily similar" to a 2016 fatal crash involving Joshua Brown in which the Autopilot system failed to detect crossing trucks, leading vehicles to go underneath a tractor trailer at high speeds.

"It would be reasonable to conclude that the Defendant Tesla through its CEO and engineers was acutely aware of the problem with the 'Autopilot' failing to detect cross traffic," the judge wrote.

Banner's attorney, Lake "Trey" Lytal III, said they are "extremely proud of this result based in the evidence of punitive conduct."

The judge also cited a 2016 video showing a Tesla vehicle driving without human intervention as a way to market Autopilot. The beginning of the video shows a disclaimer which says the person in the driver's seat is only there for legal reasons. "The car is driving itself," it said.

That video shows scenarios "not dissimilar" than what Banner encountered, the judge wrote.

"Absent from this video is any indication that the video is aspirational or that this technology doesn’t currently exist in the market," he wrote.

 

[SpeedyEddy]

"Absent from this video is any indication that the video is aspirational or that this technology doesn’t currently exist in the market," he wrote.

that is legally a strong straw to hold on to, although all other documentation says to keep the hand on the wheel. Apparently, Tesla states, this in fact is totally unneccesary. Could play out bad and could tie claims up for a long time. No short term big risk of a drop IMHO, because of cashflow.

 

[jeewee3000]

that is legally a strong straw to hold on to, although all other documentation says to keep the hand on the wheel. Apparently, Tesla states, this in fact is totally unneccesary. Could play out bad and could tie claims up for a long time. No short term big risk of a drop IMHO, because of cashflow.

Meh. It's a typical "USA" ruling, if you ask me. The contract between seller (Tesla) and purchaser (the customer) of FSD trumps marketing/advertising videos.
Therefore, as a FSD customer you know you have to pay attention and keep your hands on the wheel at all times. Ruling against this is a mere social ruling IMO. (Belgian attorney here).

But let's get back on topic.

I sold 245cc's for this friday. And some 12/08 240cc's to take advantage of a potential drop.

Have more powder in case of a rise. I think I'd sell more calls the higher we go.

 

[khill]

No, I mean close long and buy puts.
That's on one and only one condition: 226 first, then 247
If 247 first, then I'll go long at that point.

It’s looking like 247 first…do you agree?

 

[thenewguy1979]

Meh. It's a typical "USA" ruling, if you ask me. The contract between seller (Tesla) and purchaser (the customer) of FSD trumps marketing/advertising videos.
Therefore, as a FSD customer you know you have to pay attention and keep your hands on the wheel at all times. Ruling against this is a mere social ruling IMO. (Belgian attorney here).

But let's get back on topic.

I sold 245cc's for this friday. And some 12/08 240cc's to take advantage of a potential drop.

Have more powder in case of a rise. I think I'd sell more calls the higher we go.

Seem you got tons of stock wanting to offload. ballsy move on 12/8

 

[intelligator]

Sizable pullout at c240, action at 242.5, 245 , slight add to c255, the tallest call wall. Put call ratio 1.06 (more puts than calls), M-P at $232.5, tallest put OI $230, my -(S)WAG is 245-ish today, if it sticks.

 

[Jim Holder]

QTA levels for today

11/17

12/1

 

[jeewee3000]

Seem you got tons of stock wanting to offload. ballsy move on 12/8

I'm not really expecting to hold those to expiration. The 12/8 cc's are more of a theta-play.

there's three scenario's:
1) SP goes down: I will "time a bottom" and buy back the calls
2) SP stays flat ($242 for example): I can buy the calls back close to expiration with a "theta driven" profit
3) SP rises: rolling or playing the Wheel.

Plenty of options. (pun intended)

 

[Max Plaid]

STO 50x 12/1 -p230 @$3.1

Still holding 50x 11/24 -p230 / 215x -c250