Wiki Selling TSLA Options - Be the House

[stealthyc]

If they did flag, they gave no indication of it. I see no reason for a flag in this situation, do you?

I meant if you sell buy sell before settlement in a non-margin account.

 

[BornToFly]

Last week I closed early and opened new positions for this week with nice profits. Doing the same today for next week doesn't seem to work. I will wait until Thursday or Friday, and possibly Monday if the market is undecided on how to react to TSLA after the earnings.

 

[bkp_duke]

Last week I closed early and opened new positions for this week with nice profits. Doing the same today for next week doesn't seem to work. I will wait until Thursday or Friday, and possibly Monday if the market is undecided on how to react to TSLA after the earnings.

I wonder if we are in the IV crush now, instead of post-earnings.

 

[samppa]

Can I ask where you are seeing 66%?

I'm seeing 4%

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Premiums for next week also are really low.

IBs optiontrader, for this friday. shows 60% now.
Next week it shows around 40%.

 

[Drezil]

Opened an experimental position to take advantage of IV-Crush: +825p/-865p/-865c/+905c. An ironfly (so a 865 short-straddle with 40$ defined risk to each side). Max loss: 4k but 2.7k gained by opening => Effective coinflip with 2.7k gain/1.3k loss
Lets see how this playes out.

 

[adiggs]

I've rolled my various BPS that were open this morning into 700/800s still expiring this week. I collected around 2.30 premiums on these new puts, with my thinking that I'll be closing these first thing tomorrow and starting up new BPS for 10/29. Yes - I expect at least a short lived drop in the share price after earnings and I'm aiming to establish next week's position during that drop.

In the meantime rolling up to the 800 strike gets me some incremental revenue to be earned today and over earnings.

Then again they're ahead by enough already that I might also be closing these prior to the end of trading today. If I've already earned more than 1/2 by later in the day, then I probably take that off the table and watch earning from the sidelines.

 

[vwman111]

I wonder if we are in the IV crush now, instead of post-earnings.

Nope...IV is still "high" compared to previous weeks. It has been steady around 60. For comparison, next week's options are mid 40s. So although not as high as previous earnings, we are still at an increased level due to earnings tonight.

 

[bkp_duke]

Nope...IV is still "high" compared to previous weeks. It has been steady around 60. For comparison, next week's options are mid 40s. So although not as high as previous earnings, we are still at an increased level due to earnings tonight.

I'm seeing mid 30s on the stock IV right now. Where are you getting 60?

 

[bkp_duke]

IBs optiontrader, for this friday. shows 60% now.
Next week it shows around 40%.

View attachment 723631

I believe we all need to be VERY specific when talking about IV.

You are showing IV for different Options, if I am reading this right. I'm simply referring to the IV for the underlying stock itself.

 

[strago13]

I am waiting to close my puts for 10/22 today, they are about 75% now, but I will close them before end of day today and wait to open next weeks positions until tomorrow or Friday. The premiums just are not worth the risk.

 

[InTheShadows]

It seems to me like many people are unnecessarily closing positions that are very unlikely to be a loss with only 1 or 2 DTE. If you are on margin and playing it safely, by say, using <40% of it, then I see no reason to close or roll a position even if it is up 90%. Just use more margin for that extra day or two for new positions, let your old positions expire, and make more money. It seems to be almost impossible to close a BPS before expiration for the full credit, there always seems to be some value left in them. So better to let it expire.

You need to break it down to $/day the trade is open. Do that and you will see most of the time the last 15% or so is not worth it.

 

[dc_h]

I've sold all positions for tomorrow. Scientifically, with the IV drop tomorrow morning, this is not the right call. I think the risk of a major up or down move is significant, but not super likely. We've had a big run up to earnings and earnings are likely to beat big time. In theory they could write something off we don't expect, but I would expect the plan for post Elon earnings is to have the most drama free earnings call imaginable, only surprise is upside revenue, earnings and margins. Maybe some 950 calls for a lottery would be fun, but I want to listen to the earnings and just root for good news.

I have held onto an @accountant honorary ATM 865 covered call and if called will sell an ATM put for next week and add to my weekly bps/bcs condor routine. I'm all in tax free accounts, so that has no impact on my actions. Longer term, I do want to start shifting trade profits to some safer place. I don't want to be a black swan away from losing all my trading profits. That can't happen if I limit my trading to 10-20% of my investment capital.

 

[InTheShadows]

It's a strange week, with puts that are far OTM still holding a lot of value on the possibility of a big downswing. That effect should be gone later this week, so hopefully we can go back to normal and get some nicer BPS-premiums again.

I think premiums are higher than normal now. This is Wednesday and for an 820 put delta -15 it’s 3.80. That’s about $1 more than I normally see this time of week for one std deviation out. I’m playing super cautious so it feels like low premiums but I am normally much more aggressive than I am now. I think most of us are. We have just had a massive rally and earnings is tonight. Anything in the report or future forecasting that causes even a minor blip could set off a decent drop tomorrow.

History has taught me that I don’t make as much when I need to manage trades. So one of my new goals starting in September is to try and set up my trades so I won’t need to manage them.

 

[InTheShadows]

If they did flag, they gave no indication of it. I see no reason for a flag in this situation, do you?

Before I had spread trading in my Ira, options settle the next day, shares took 3 days. So as long as I waited until the next day to close my position from unsettled funds I was good.

 

[InTheShadows]

IBs optiontrader, for this friday. shows 60% now.
Next week it shows around 40%.

View attachment 723631

I know in TOS you can add columns to your option chain. Adding iv would be good. Then you get a view similar to this. I also add delta and theta.

 

[corduroy]

The past 6 quarters we dropped an average of -2.7% the day after earnings (all with earnings beats). If (and that's a big if) that pattern holds, and we close around $865 today, tomorrow we would drop to $842.

 

[InTheShadows]

I agree completely. This is why I have all my short legs at 745, If we get a 16.28% sell-off, I’m pretty sure I will only need to manage for a week. And I also have a week of extra time because I sold 10/29’s. I have GTC 50% on them now. If any trigger before market close tonight I’m leaving those off the table. After earnings tonight I will adjust the orders based on post market.

 

[generalenthu]

IBs optiontrader, for this friday. shows 60% now.
Next week it shows around 40%.

View attachment 723631

This post has been a lifesaver. Didn't realize the mobile app introduced a dark theme. Thank you!

 

[bkp_duke]

I'm out of my positions as well. Premiums were so small that it just wasn't worth it.

Same. Dry powder at the ready now.

 

[dl003]

My body is ready. I still have 730/950 short strangles open to keep it interesting, but ready nonetheless.