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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Rolling iron condors? If one of the legs moves too much against you, what is the best strategy (since the BPS and BCS need to have same expiration dates). Let's say 750/800 - 1000/1050 and SP gets to 1000. Do you close just the 1000/1050 at a loss and wait on the BPS until the 750/800 is at 90+% profit, and then open a whole new condor, or close everything at the same time in one trade, and immediately open a fresh IC for the following week? Other option is just close the 1000 and hope the 1050 keeps increasing in value, but if the SP reverses, you feel 2x the pain....
If SP is close to 1000, then your 750/800 should already be very profitable at that point. I would close the whole IC and open up something like 800/850 and 1050/1100 for the next week.
I think after Q3 many PMs are looking to add TSLA. Bear raids might be quickly bought up if they cause a significant SP drop.
Macros might be a different story, who knows.
I think we're all newbies. I know that I am, and likely to still be in a few more years.
My initial thoughts is to take a subset of my shares / leaps, and start selling the aggressive cc's. The idea is to raise the high premiums right now and positions myself to either collect those high premiums and sell at this ATH, or collect those high premiums and watch the shares drop back leaving me with the shares as well. I'd be doing this with something like 1/5th of the leaps / shares as sort of a programmed sale at a high, much as the leaps I own were purchased at a relative low.I hope we don't have to wait too long - not sure if my addicted brain can survive very long without the next 'fix'. Looking forward to getting more insights from your noodling - I have plenty of profitable leaps that are just sitting in my IRA that could benefit. Not sure I would want to do this in my brokerage - the risk of assignment and resulting tax liability is just too high (these are June'22 with 252 strike price -very deep ITM, but don't want to sell and take the profit this year)
Whether I keep those initial shares as well, then I probably take another 1/5th and add them into pile being sold if/when the shares reach $1000.
But I've got a larger setup where this seems to fit well. A brokerage account for living expenses in which I'm also just paying the taxes -- it's a big headwind
Holding onto the shares and leaps is probably what I'll do here - no need to increase the tax bill for this year at this point.I've got a retirement account that is focused on growth. That means mostly leaps and a lot of put sales - I won't start selling the aggressive cc's while we've just barely hit the ATH - I'll wait for a longer run before I start doing this.
The final account though - it's a rollover IRA that I use as needed (so far that means never) for lumps of cash. I like the idea of doing some targeted sales at relatively good prices, positioning that account to make particularly good use of the shares coming back down.
From my two experiences doing this, no. I think the $100 moving to 2x$50 got me something like 1.25x the premium from just selling the $100 wide spread up front. The 2x $50 wide spreads is probably 1.5-1.75x the premium from the $100 wide spreads.
So the $100 wide spreads are definitely giving up some income in exchange for that less risky (to me) position. I think of the roll into 2x $50 wide spreads to be a mechanism to reclaim some of the premium missed out on by starting with the 2x $50s, while affording me the choice to do nothing if we're just too close ATM to take the risk.
Adjusting Iron Condors – 2023 Ultimate Guide
Despite what others might try and tell you (usually when they are trying to sell you something), adjusting Iron Condors is not rocket science. You don’t need some fancy system or training that costs hundreds of
optionstradingiq.com
8 Adjustments For Credit Spread Positions Under Pressure
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How to Adjust a Losing Credit Spread Option Strategy
Learn how to adjust a losing credit spread option strategy with a quick and easy hedging strategy.
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How to Adjust a Losing Credit Spread
Today, we will look at how to adjust a losing credit spread. When a credit spread goes against us, there are three primary actions we can take: hedge it, roll it, or close it. Yes, you can
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So I finally figured out two things I had wrong with my account. We used to be a part of Capital One 360, before they merged with eTrade. When that merger happened, it screwed up our new eTrade account and added a joint owner (me). For some weird reason the margin analyzer and calculator I was using on the primary account holder's (my partner) account didn't and still doesnt work. eTrade has no idea what is wrong with it. If I use my account, it works fine. I'm sure this is some software artifact on the backend.
I also realized that even though I was able to sell a BPS to test it out, it was taking away margin at naked put levels, not BPS levels. Of course I didnt know this at the time because the margin calculator wasnt working. I had to upgrade my account to Level 3 to officially use spreads which I hope means it will charge me properly per BPS contract mid next week.
I also realized that even though I was able to sell a BPS to test it out, it was taking away margin at naked put levels, not BPS levels. Of course I didnt know this at the time because the margin calculator wasnt working. I had to upgrade my account to Level 3 to officially use spreads which I hope means it will charge me properly per BPS contract mid next week.
In the example the put side of that IC will be borderline 99% profitable if one waits that long. More likely to have rolled the put leg for a second bit of premium, and still have it closing in on full profit.
My guess is that a simple close will yield a net loss on the position due to how small the premiums were that got into the position. I expect that to routinely be the case for these distant / far OTM strikes that see a big move put them close to the money. It's a consequence of this larger approach (small % gains on far OTM positions, with leverage turning those small % gains into large absolute $ gains).
One might be able to execute a roll to keep a net inflow of cash even while taking the loss that is in the call spread. That roll would be a straight up close of the BPS ($ outflow; confirming a high % profit). That doesn't free up any margin, but it does close one of the claims on that margin.
Then the call spread can be rolled to the new expiration date for whatever net credit takes you from the current position to the new position (a 4 legged trading ticket).
And lastly that new week BPS can be opened (or wait a few hours or days for a better entry) to leg back into the IC.
Great stuff Yoona! So many fancy strategies, but most of them don't really change the percent above the current strike at which your profit goes to zero. The one I like best, that I hadn't thought of, is staying with the same expiration, but re-centering and decreasing the width. So back to my example of 750/800 - 1000/1050. If the SP rises to 980 by Wednesday, change the spread (hopefully at no cost) to 870/920 - 1050/1100 and keep the Friday expiration.Adjusting Iron Condors – 2023 Ultimate Guide
Despite what others might try and tell you (usually when they are trying to sell you something), adjusting Iron Condors is not rocket science. You don’t need some fancy system or training that costs hundreds of8 Adjustments For Credit Spread Positions Under Pressure
8 Adjustments For Credit Spread Positions Under Pressure - Download as a PDF or view online for freeHow to Adjust a Losing Credit Spread Option Strategy
Learn how to adjust a losing credit spread option strategy with a quick and easy hedging strategy.How to Adjust a Losing Credit Spread
Today, we will look at how to adjust a losing credit spread. When a credit spread goes against us, there are three primary actions we can take: hedge it, roll it, or close it. Yes, you can
thanks for YOU doing all the research to find MY exit strategy
coz i have exactly those 10/29 4 strikes...for now, not panicking yet since:
only 5 DTE
-c1000 is 7 delta
-c1000 is 10% away
sp is bullseye-center of IC range
i am short vega which means sp going
is more $ for me (that is how i understand this greek)
My understanding of vega is that it is the measure of option value (premium) change due to changes in IV.i am short vega which means sp going
Therefore Vega will have its own effect due to changes in IV, whether the share price is going up or down. Delta is the measure of change in the option premium due to share price going up or down.
looking for my cheat sheet.... finding... finding... found!
the greeks of the unbalanced IC example below is the same as my IC (+delta, -gamma, +theta, -vega); so if sp moves up from 909 to 1000, it's +$$$.
i guess the key word is "normally" - there is nothing normal about TSLA!
dc_h
Active Member
If the IV continues to decline, the magic beanstalk ma stop growing and you’d have sold out your growth, without the golden egg laying yen. If Tesla splits and joins the S&P next year, the volatility would dry up. Look at Apple and see how much you can scrape out every week. I think our gigs success depends on instability and debate about the viability of Tesla itself. The more that debate is settled, the less our BPS game pays off.
2020 called and TSLA split and is in the S&P
Hate to break it to you about the bolded part above...
But agree that we need bears and shorts to keep this gig running. Kinda makes you appreciate the GoJos of the world and maybe gives some insight into a possible motivation to go on TV and be blatantly and embarrassingly wrong day after day. Maybe he's secretly been selling BPS all this time?
If thought this many times privately, why else would someone embarrass themselves this way continually?
They likely meant: "splits and joins the Dow."
Edit: I actually looked at selling Apple BPS 10% out of the money. About half of TSLA. 5 cents for $5 BPS spreads, so $1.1 per iron condor for $5000 of Margin
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dc_h
Active Member
Meant Dow. May not happen anyhow, but will be hard to ignore as revenue really gets big. IV will continue to decline as tslaq clout declines. I tried selling CCs for Apple and it’s not very profitable. They could split again after blowing through 1200-1500 to help employees sell options in smaller amounts, but short positions are far less important.2020 called and TSLA split and is in the S&P
... Well.. for me that is nearly passive investingSo far in October I have made 17% of my whole portfolio value. This is only from selling bps.. I mostly use around 70-80% of my available margin. Some weeks I have sold more spreads toward expiry and used my whole initial margin, which is around to 90% of my maintenance margin.
Actually 17% was counted on todays portfolio value, in fact it's more. My portfolio is now 75% tsla/25% cash and of course value of shares have gone up a lot lately.. so probably closer to 20%.
In 3 weeks. This is nuts
I had +20% Thursday alone.. after ~10% the other days. In 30 days I turned ~250k into ~720k.. THAT is nuts. And I will invest way more passive now and aim for only 1% portfolio performance per week...
But if TSLA continues to rise I might not be able to fend all that money off..
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