Wiki Selling TSLA Options - Be the House

[dl003]

I probably won't close my puts, given this price action. May roll them out to 12/15 & reduce the spread

 

[dl003]

I think to survive, we need to not "Bet the farm" on a belief of what will happen. Buying a Put spread and selling CCs is betting the farm, because both require the SP to do one thing - go down. Since there really is not way to know, we can't guess ahead of time on only one direction, and our trades should make money on both directions if possible.

In my opinion, buying put spreads is just a trade. Worst you can do is lose 100%
Selling CCs against the trend can be betting the farm, which is not what I've been doing. Can easily lose 1000%.

 

[juanmedina]

I probably won't close my puts, given this price action. May roll them out to 12/15 & reduce the spread

I am leaving my puts open too. After the Cybertruck event is when I will make my decision to close them or not.

Right now I have a decent amount of $245-240cc's for this Friday. You are welcome everybody.

 

[Jim Holder]

 

[Max Plaid]

Nice wick on top of the hourly building. dropping to closing price or below within the hour (may it be after a new top) would make the opening ralley look bearish after all (shooting star !!)
[Edit] plus 23.6 fib incoming @ 253.00 ((often traded zone already entered) [/Edit]

Macro pulling back - look at AAPL, for instance - only TSLA green on the hourly for the M7 stocks

 

[Max Plaid]

In my opinion, buying put spreads is just a trade. Worst you can do is lose 100%
Selling CCs against the trend can be betting the farm, which is not what I've been doing. Can easily lose 1000%.

Well that depends, you don't necessarily lose anything, but you do potentially limit profits... if you're selling CC's on shares purchased in 2016 then there's a lot of profit to be had if they get exercised

It basically comes down to either only writing CC's that you're OK to allow shares to be called against, be happy to roll them for as long as it takes, or keep plenty of contracts free to facilitate rolling

 

[dl003]

Flow is supportive of relative strength today so I'm not expecting a pullback just yet. Rolled my 225/215 12/8 puts to 225/220 12/15.

 

[SpeedyEddy]

this really is exciting, the wick is long , but the base must be approached closer the coming 7 minutes so in line with (@Jim Holder post) above "wicked stocks"
[Edit] no real shooting star so the bulls have it for now [/Edit]
[Edit] volume really dropping, so another wait-and-see where the few can manipulate best influence things[/Edit]

 

[Jim Holder]

QTA levels for today

12/1

12/8

 

[SpeedyEddy]

Macro pulling back - look at AAPL, for instance - only TSLA green on the hourly for the M7 stocks

View attachment 994636

Now that's a shooting star!

 

[thenewguy1979]

Well that depends, you don't necessarily lose anything, but you do potentially limit profits... if you're selling CC's on shares purchased in 2016 then there's a lot of profit to be had if they get exercised

It basically comes down to either only writing CC's that you're OK to allow shares to be called against, be happy to roll them for as long as it takes, or keep plenty of contracts free to facilitate rolling

If I have hundreds of share from 2016 I would be doing CC all days. Win win. Get paid to sell your stock as today price. If dont get assigned - free money basically. Rinse and repeat.

But no there yet. So got to do the safer risk defined option stragedy. Till SP drop enough to do cash covered put to begin the wheel

 

[SpeedyEddy]

curious to know what will happen when/if we are really closing the opening gap the next minutes.. The breakout was far more then 2% above the expected top

 

[Tachyon]

If I have hundreds of share from 2016 I would be doing CC all days. Win win. Get paid to sell your stock as today price. If dont get assigned - free money basically. Rinse and repeat.

But no there yet. So got to do the safer risk defined option stragedy. Till SP drop enough to do cash covered put to begin the wheel

If you had shares from 2016, I bet you wouldn’t risk paying huge capital gains when sold calls get assigned in return for measly weekly pennies as premium on those sold calls . You will be a HODLER .

 

[EVNow]

Well that depends, you don't necessarily lose anything, but you do potentially limit profits... if you're selling CC's on shares purchased in 2016 then there's a lot of profit to be had if they get exercised

It basically comes down to either only writing CC's that you're OK to allow shares to be called against, be happy to roll them for as long as it takes, or keep plenty of contracts free to facilitate rolling

Yes - if the strike is above cost basis, its not a loss. Besides you can keep rolling (as I did for a quarter this year).

As to @BornToFly comment, essentially you have two ways to make money on options
- Bet on a direction
- Bet on limited change

"Be the house" implies the second. Betting on direction is just trading. Generally people should be betting a small % of their capital on trades (like 1%) - but "be the house" can be a larger % of capital if the delta is low.

 

[dl003]

Well that depends, you don't necessarily lose anything, but you do potentially limit profits... if you're selling CC's on shares purchased in 2016 then there's a lot of profit to be had if they get exercised

It basically comes down to either only writing CC's that you're OK to allow shares to be called against, be happy to roll them for as long as it takes, or keep plenty of contracts free to facilitate rolling

selling naked calls have made me realize that holding shares and selling calls are 2 separate decisions and I should try to get the optimal result for both. I sell naked calls on a lot of stocks: NFLX, NVDA, SPY, FDX etc... and I don't own any of their stock. So if I do it wrong, I can lose a lot. I apply the same thinking to TSLA although my cost basis is in the $2x. I don't think I have a predetermined price I'm comfortable with selling at.

 

[EVNow]

If I have hundreds of share from 2016 I would be doing CC all days. Win win. Get paid to sell your stock as today price. If dont get assigned - free money basically. Rinse and repeat.

Not really. Many of us sold puts near the top and if you get assigned at 400 would you sell CC at a strike of 120 when the SP is at 100 ?

 

[Jim Holder]

 

[EVNow]

selling naked calls have made me realize that holding shares and selling calls are 2 separate decisions

That is definitely one way to look at it - but not the only way. For many of us the idea is to hold TSLA long term - and sell CC along the way to make some money. So, the second is contingent on the first.

 

[thenewguy1979]

Not really. Many of us sold puts near the top and if you get assigned at 400 would you sell CC at a strike of 120 when the SP is at 100 ?

Yes. there several variables that goes into the decision. Simple me just see the easy ways. Thank for making me a wiser dog day by day.

 

[SpeedyEddy]

lower highs, lower lows on smaller timeframes. Bearish engulfing... Here we go... down
GAP filled... and now..