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Wiki Selling TSLA Options - Be the House

BornToFly

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May 8, 2013
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I have 300 x 580/680 PS for next Friday. Thinking of adding some safer 570/620s for a little more play money. I've been at this long enough to know that <700 next Friday is unlikely, but NOT out of the question thanks to Macros....
Actually, I take that back. Looking at the BB, I don't see that we have ever gone from just below the top, to out the bottom in one week. 700 should be a safe bottom next week. Should...
 
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winfield100

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Feb 16, 2013
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Actually, I take that back. Looking at the BB, I don't see that we have ever gone from just below the top, to out the bottom in one week. 700 should be a safe bottom next week. Should...
1632959634166.png
 

mongo

Well-Known Member
May 3, 2017
13,950
45,201
Michigan
Anyone taken a look at the max pain chart for next week 10/08 yet?
Weird that max pain is listed at $725.... because there is a solid put wall at $720 of 55k puts but also a call wall at $700 of almost 32k calls....
Just weird IMO.
Probably the 23k calls at $800 skewing it upward.

Personally, if I can close out my positions on Friday, I don't intend to open anything till late Mon or early Tues. And then it will just be quick, I don't want to hold any calls or puts for the 10/7 shareholder meeting.
More likely the 14k of puts at $750.
Calls far above and puts far below max pain do not influence its value since they are OTM.
$725 kills the puts at $720 (55k oi) and $725 (9k oi) while reducing the $750 put value without paying out too much on the 700 calls (32k OI)
It's a big summation of all higher puts vs all lower calls. Big OI just increase the slope of payout per dollar of stock price.
 

EV forever

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Apr 23, 2016
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Pretty sure the price on 10/8 will be 700-800, +/- 50. So I'm opening a 50/100/1000/1050 IC, limit fill @$4 premium.... hasn't filled yet.
The CCS portion at 1000/1050 is paying only 0.05 per option. I know it is a free bet, but is it worth the trouble going for it? I guess depending on how many options could be beer money.
 

buttershrimp

Click my signature to Go Mad Max Mode
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Jun 17, 2017
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The CCS portion at 1000/1050 is paying only 0.05 per option. I know it is a free bet, but is it worth the trouble going for it? I guess depending on how many options could be beer money.
I like to live dangerously, so I might tighten the spread to 1000/1010 to demonstrate my confidence that it will close under 1000 next Friday. I could lose hundreds (if not thousands) of cents if I’m wrong. wish me luck gentleman
 

Chenkers

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Apr 28, 2019
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What is an IC? Thanks!!
'The Wheel' Thread Glossary:

IC: Iron Condor
BPS: Bull Put Spread
BCS: Bear Call Spread
CC: Covered Call
LCC: a LEAP Covered Call
LEAP: A long dated option, typically 12 months+
C+/C-: Bought/Sold Call Option
P+/P-: Bought/Sold Put Option
STO: Sold to Open
BTC: Buy to Close
BB: Bollinger Bands
SP: Share Price (TSLA)
$TSLA: Value of a Tesla stock holding
IV: Implied Volatility of an Option
OTM: An option that is Out of the Money (eg a Call above current SP)
ITM: An option that is In the Money (eg a Call below current SP)
CTM: Close to the Money (eg very near the current SP)
DITM/DOTM: Deep In or Out of the Money
OI: Open Interest (number of contracts at a strike on the options chain)
Call/Put Wall: A significant high point on the OI graph (Stock Option Max Pain)
The Wheel: An Options strategy where if a call is exercised you sell an aggressive Put that may get exercised or vice versa.
ShitCall/ShitPut: Well OTM lower value CC or Put
I Dare You Calls/Puts: Very CTM Calls or Puts, often near a strong Call/Put Wall
 
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'The Wheel' Thread Glossary:

IC: Iron Condor
BPS: Bull Put Spread
BCS: Bear Call Spread
CC: Covered Call
LCC: Leap Covered Call
C+: Bought Call Option
C-: Sold Call Option
P+: Bought Put Option
P-: Sold Put Option
STO: Sold to Open
BTC: Buy to Close
LEAP: A long dated option, typically 12 months+
BB: Bollinger Bands
SP: Share Price (TSLA)
IV: Implied Volatility of an Option
OTM: An option that is Out of the Money (eg a Call above current SP)
ITM: An option that is In of the Money (eg a Call below current SP)
DITM/DOTM: Deep In or Out of the Money
OI: Open Interest (number of contracts at a strike on the options chain)
Call/Put Wall: A significant high point on the OI graph (Stock Option Max Pain)
The Wheel: An Options strategy where if a call is exercised you sell an aggressive Put that may get exercised.
You forgot shitputs/shitcalls - please amend
 

jeewee3000

Active Member
Sep 1, 2015
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Belgium
800cc 10/1 OI (open interes) update:

monday 9/27: 12.600 (+/-)
tuesday 9/28: 17.355 [+4.755]
wednesday 9/29: 22.520 [+5.165]

The call wall at $800 has therefore nearly doubled since Monday. Volume on these calls was around 120k (!) yesterday, so lots of trading going on. The deeper into the week without $800 being breached the higher the probability IMO of closing below $800 on Friday.

I'm still holding on. Will only think of rolling if we breach $800 on volume.
800cc OI dropped slightly to 22.283 today.

I got out of my 800cc's at break-even yesterday with an automatic (edit: sell ) buy order. I strongly believe 800 won't be breached by tomorrow or monday, but the risk/reward is not balanced enough for my purposes.

I'd rather enjoy a friday surge instead of fretting about it.

GLTA. Next week should be great.
 
Looking for some advice here from everyone.

I get that some people are using the wheel to act as an income replacement. I am not in that stage yet -- I am still in the growth stage of things (long term goal of TSLA to 2-2.5k, maybe 5 years?). With the weekly premiums that I am accumulating, I want to reinvest that back into TSLA because I think there are 2-3 more legs up before we level off for a while. I also really am reticent to touch any of the shares I have and lose them, so I am playing pretty conservative and not selling CC and focusing exclusively on selling puts right now. This is also a taxable account. What is the best approach to grow from your perspective?

Buy DOTM LEAPS (Jan 24 1500 calls)?
Buy DITM LEAPS (Jan24 600 calls)?
Buy shares?

Another question, if I buy a DITM calls and then sell CC off of that and get assigned, is there a way for me to choose which shares get taken away? Or does the broker have sole control over that?

Thanks in advance!
 

Knightshade

Well-Known Member
Jul 31, 2017
14,016
24,440
NC
Another question, if I buy a DITM calls and then sell CC off of that and get assigned, is there a way for me to choose which shares get taken away? Or does the broker have sole control over that?

Thanks in advance!


You have SOME control. How much depends on the broker.

Some you can actually select this online, swapping share lots as long as it's not settled yet.

For me I have to call my broker to assign specific shares to an assignment, which is annoying and another thing that makes me happy switching to BPS.
 
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CHGolferJim

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Jan 28, 2014
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I'm loading up on LEAPs in retirement account. Went with 10x $750 Jan 2024 to start off the day.

Will be looking to load up more if anyone has some non-advice on when might be a good time. ;)
Go back about 3 months and read and take notes on @Lycanthrope and @adiggs posts in this thread.
 

Chenkers

Member
Supporting Member
Apr 28, 2019
615
7,094
Melbourne, AU
Looking for some advice here from everyone.

I get that some people are using the wheel to act as an income replacement. I am not in that stage yet -- I am still in the growth stage of things (long term goal of TSLA to 2-2.5k, maybe 5 years?). With the weekly premiums that I am accumulating, I want to reinvest that back into TSLA because I think there are 2-3 more legs up before we level off for a while. I also really am reticent to touch any of the shares I have and lose them, so I am playing pretty conservative and not selling CC and focusing exclusively on selling puts right now. This is also a taxable account. What is the best approach to grow from your perspective?

Buy DOTM LEAPS (Jan 24 1500 calls)?
Buy DITM LEAPS (Jan24 600 calls)?
Buy shares?

Another question, if I buy a DITM calls and then sell CC off of that and get assigned, is there a way for me to choose which shares get taken away? Or does the broker have sole control over that?

Thanks in advance!
It depends on your broker and account setup. I did some careful analysis about a month ago comparing various strategies. I HODL my shares and sell spreads (IC, BPS, BCS) against the excess margin liquidity backing in the account. This gives me the maximum premium return against allocated margin. And the excess margin accumulates most by keeping premiums in the account as cash. So for me the best approach has been to accumulate cash to maximise the account liquidity to then sell even more contracts to generate more cash. At some point (very soon) I top out the number of contracts I'm prepared to sell and then use the generated cash to accumulate by buying LEAP spreads and shares.
 

ammulder

3P, X ordered
Supporting Member
Apr 11, 2019
1,452
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Philly area
Welp, rolled all put spreads and closed my couple remaining c815s this morning. I have definitely met my income goals for the week.

On the put side, next week I'm trying a $100 spread for closer to the money and $50 spread for further away (equal numbers of each). Assuming the quarterly numbers are OK I think there's very little risk to either, but I feel better with the larger spread where I'm more likely to need to act, and I like the better premiums from more contracts of the smaller spread in the safer-but-less-profitable territory.
 

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