Wiki Selling TSLA Options - Be the House

[ammulder]

Yeah. I found the shareholders meeting a bit underwhelming… was hoping for “one more thing”… or at least some mention of the %#@* Model X!

If there’s going to be a further climb now, I think it’ll have to be on the basis of the Q3 financials.

 

[EnzoXYZ]

I will likely sell CC again now that most of my worries are taken off the table: stock split, unexpectedly fast Austin production of Y in Q4, and dividend talk seem addressed tonight.
Will be careful with Q3 earnings obviously as this should, IMO, be most impactful.

I only opened 1/2 BPS for next week. Maybe we get a pull back tomorrow for other half for next week. Will add call spreads to complete ICs.

Anyone seeing differently or changing strategy for next week?

 

[Cherry Wine]

Since this thread is more focused on short-term movements than the main thread - just wanted to share that the procedural vote on the debt ceiling extension has the votes needed to advance. Barring some craziness on the actual vote, it should pass, thereby averting a catastrophic reaction in the financial markets (at least for the next 6 weeks or so).

 

[Cherry Wine]

Dave is talking about us on Twitter.

 

[juanmedina]

Dave is talking about us on Twitter.

?

 

[MP3Mike]

?

Twitter

edit: It seems to be over, and I don't see a recording available.

 

[juanmedina]

Twitter

edit: It seems to be over, and I don't see a recording available.

What he said? Haha.

 

[BornToFly]

Dave is talking about us on Twitter.

Don't know what he said. But, if everyone starts doing what we are doing, the contracts won't be worth anything anymore. Maybe we need to start a super secret society....

 

[buttershrimp]

I have spent some time thinking about this and came to the conclusion that as long as I could weather a 6 month storm I would be fine. I had some nasty trades this spring with cash secured puts that went against me that basically stalled out my earnings for 3 months, I finally cut them as losses to free up capital with the new information I had learned here. (Though I think with what I know now I would have been able to exit those as break evens or even possibly as winners.)

The reason I came to the 6 month conclusion was because of the last market disasters we have had, 9/11, 2008, covid. In every instance the FED stepped in and fired up the printing press to prop the market back up. I got burned buying puts during covid because I thought there was no way the market could recover that fast. Then after a lot of losses I realized that I was betting against the FED and their printing presses.

Even look at Evergrande, different country, same actions by the government. Fire up the printing presses and bail them out. Just like I think Ford and GM will be getting a bailout within the next 4 years (Is this in the form of the tax credit? I hope so because tsla will take most of it.).

If you look at Warren Buffett's net worth graph. It followed this trajectory and how much easier is it for us to trade now and to have access to the TSLA trading pool (everyone here) than it was then.

I want to know how Buffet lost almost half his worth at age 44?

 

[adiggs]

Dave is talking about us on Twitter.

I don't know if I should or

 

[MXWing]

Don't know what he said. But, if everyone starts doing what we are doing, the contracts won't be worth anything anymore. Maybe we need to start a super secret society....

Options are not a secret and the volume here is paltry compared to funds.

Imagine selling all these BPS in March and needing to defend 900 short puts all the way down to 550. Put buyers can have their day as well.

Also they are not losing what we think they are losing as most of their trades are delta neutral.

WSB is far more disruptive to the options market than we are.

In general though, it would be best NOT to get attention.

I've contemplated suggesting or starting a Slack group so things can be discussed more so in real time. Keep it to people that are vetted and be willing to log trades for transparency. I belong it to groups like this but non specifically focused to Tesla.

 

[buttershrimp]

The key difference to take into account is that there are people who are doing this, have been doing this for a long time and who have made yacht loads of money and quit.
The reason institutions (like Peter Lynch's firm) and others do not is they are diversified, and have a duty to their account holders to make sure one stock or equity cannot tank the fund.

Thus being diversified, they have limited analysts that can research individual stocks and companies - Even ARK and Cathie Wood's firm has their top people researching and knowing all they can about a lot of stocks.

We have a unique ability and liability in that we are only beholden to ourselves (and families) and have a distinct informational advantage.
We can also be 100% in one stock if we want because the only rules are those set by ourselves.

This is something - options and all derivatives - that many a fortune has been won or lost on.
Start small, build up and learn along the way.
There is no other shoe to drop for those reasons. The market rules have not changed, and unless they do, this is the game we get to play if we want.

One other tangent that works is - most - if not the super majority of people do not have the time, patience, starting capital or mental toughness to do this.
It is not easy to go through all the numbers, greeks, strikes, upcoming catalysts, reports, announcements, twitter, forums, etc., etc., etc.... and stay on top of to be successful.
So in short (no pun intended) it is sustainable long term, there is no secret and we can all do it. It does however take a lot of work to be consistent and profitable, and for me that is also very enjoyable.
Cheers!

preach…. this is one of the most challenging things I’ve learned to do… much of that has to do with the speed and intensity in which tend to take on interests in my life. I’m very fortunate for your help and the help of others …. personally I like the challenge.

 

[InTheShadows]

Options are not a secret and the volume here is paltry compared to funds.

Imagine selling all these BPS in March and needing to defend 900 short puts all the way down to 550. Put buyers can have their day as well.

Also they are not losing what we think they are losing as most of their trades are delta neutral.

WSB is far more disruptive to the options market than we are.

In general though, it would be best NOT to get attention.

I've contemplated suggesting or starting a Slack group so things can be discussed more so in real time. Keep it to people that are vetted and be willing to log trades for transparency. I belong it to groups like this but non specifically focused to Tesla.

I am kind of for that. There is more I would share if this was a private group and not open to the internet trolling robots. It’d be cool if TMC would allow private threads (with no robots) that could have their own mods that allow people .

The hesitation to the slack group is, I am already in an investing one and I keep it muted because it ends up getting too chatty for notifications. Even our work slack gets annoying at times.

 

[Chenkers]

Mod: Using my mod skillz I created the following thread, using @Chenkers (Thanks!) glossary as a start. Made it a wiki but not sure who can edit besides @Chenkers and mods. --ggr

Wiki - Options & "the Wheel" Glossary and FAQ

This is the Glossary and FAQ for: https://teslamotorsclub.com/tmc/threads/selling-tsla-options-be-the-house.191290/#post-4640780 The 'Be The House' 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...

teslamotorsclub.com

Thanks for setting this up @ggr . I'm happy to put some work into expanding the FAQ wiki if we're happy to have it as a reference point.

A management and readability idea that occurs - @Chenkers glossary has also been turned into a Wiki. The obvious thing to do is to link to that wiki / glossary, and maintain the glossary there, rather than trying to put that content into this thread. Hopefully Chenkers is ready and willing to expand on that glossary as needed (which means that somebody sees a term to add, or somebody is wondering what a term is - answer as usual, but also call it out for addition to that post).

Which also leads to an idea, with no specific idea on my part for implementation - putting chunks of ideas into their own Wiki for separate management, and link to them from here.

Maybe a management techniques post, which might in turn provide a pile of links to yet other content (Youtube videos, articles, whatever). I think the only thing to do for now is have this in mind, and when a section of the first post gets really large, and seems like it could stand reasonably well on its own, then we break it out and somebody takes on responsibility for it.

Or maybe I read this correctly elsewhere, and we can grant access to the wiki post so many can edit!

I'm thinking we could make the FAQ wiki a repository of the main strategies used here including management techniques (roll/split etc). I'm happy to edit and add suggestions that others make rather than it being just one perspective.

 

[InTheShadows]

I have some post that I have book marked that I found relevant and others that I have copied into my trading spreadsheet. Is there a way to share those with someone for consideration?

 

[vwman111]

720 is a 10% drop in one week, two weeks before a very good ER. I looked at the past charts and we seem to stay fairly stable going into every recent earnings. It's after earnings that we have problems. Also, Bollinger Bands are pretty tight and we are near the top, so I think the chance of breaching 720 next Friday is pretty low. So I'm targeting $400k/week the next two weeks, before I scale back. After the ER I will be looking at 15-20% below current SP for my short legs. The only thing that has me a little worried is Elon telling the naked short sellers that there is no stock split in the near future (I don't know if the fear of having to cover and get burned last time was keeping them at bay).

 

[ReddyLeaf]

Anybody do any successful Covered Calls only trading this week? I stayed away, and was kind of regretting it until 2:45 pm today, lol.

One day I will have the quiet time to learn about BPS and all the other Halloween candy you guys play with.

Yes, I sold some-c830s on Monday AM, the closed Wed for 60-70% profit. Then sold ONE -c800 @ $4.00 and closed it this AM for $2.70 because I definitely didn’t want in open overnight. Glad I did because it spiked over $7 in the afternoon.

 

[ReddyLeaf]

720 is a 10% drop in one week, two weeks before a very good ER. I looked at the past charts and we seem to stay fairly stable going into every recent earnings. It's after earnings that we have problems. Also, Bollinger Bands are pretty tight and we are near the top, so I think the chance of breaching 720 next Friday is pretty low. So I'm targeting $400k/week the next two weeks, before I scale back. After the ER I will be looking at 15-20% below current SP for my short legs. The only thing that has me a little worried is Elon telling the naked short sellers that there is no stock split in the near future (I don't know if the fear of having to cover and get burned last time was keeping them at bay).

Is this you. Or a combination of @Lycanthrope and @Chenkers

 

[Yoona]

Anybody do any successful Covered Calls only trading this week? I stayed away, and was kind of regretting it until 2:45 pm today, lol.

One day I will have the quiet time to learn about BPS and all the other Halloween candy you guys play with.

all my 10/8 -c820 CCs are still open; OK to be assigned so i didn't BTC

 

[FS_FRA]

Thanks @Right_Said_Fred ! I'll get back to you on a name change (soon).


For participants and newcommers - I'm taking suggestions / ideas for the new thread name.

My first idea with little or no thought:
"Selling TSLA options for fun & profit"

(I like a bit of whimsy, in addition to being descriptive).

“Trading TSLA options for fun and profit”

trading covers it better, I feel.