I had never realized the amount of negative comments towards people selling options in the main investor threads before starting to sell options. I realized some people there think there is the good side « long stock holder » and the dark side « option traders ». I am starting to dislike more and more the main investor threads.
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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
As a courtesy to theta gang here, I'll declaring I'll be buying some of the calls people are selling here.
I've been analyzing entry and I might come in a little early but I think this will be hockey stick recovery.
Price depression seems way overdone. Like one little pawn is paralyzing the entire chess board.
When little pawn decides to pull out the rug..
I've been analyzing entry and I might come in a little early but I think this will be hockey stick recovery.
Price depression seems way overdone. Like one little pawn is paralyzing the entire chess board.
When little pawn decides to pull out the rug..
Could be.
very dangerous, since they could notice the "fault" and fix it without notice.
Otoh I was able to save myself from margin trouble earlier this year by buing some far otm puts.. but I'm on Ibkr portfolio margin because I'm in europe.
I tend to ignore it as those attitudes are kind of funny in a naïve sort of a way. A lot of people want to divide things along them and us tribal lines and will resist being enlightened. Little do they realise that many of us are HODL's that also sell options against our equity. The end result is that we can get more than double the overall returns of just HODL alone while largely avoiding the perceived terrors of the 'dark side'.
I'm not at Fidelity, but I believe every broker will deal with this the same way: itm short option will be assigned, and your long option will expire if you don't specifically exercise it. After all, a long put option gives you the right to sell 100 shares at strike price, but no obligation.
Or they might liquidate the short options if you don't have enough margin to buy the shares put to you. That's what IBKR would do.
Do you guys tend to BTC really far OTM puts the last day when they are +99% or you let them expire worthless in your account. My brockerage platform has glitches where the price of a 12/11 1250 Covered call goes from $0.01 to $8.55 after the option expired worthless and it is still impacting my margin. I’m thinking of BTC all my Puts and Covered calls on fridays at expiration to avoid these options floating in my account for couple days even the week after. Do you systematically BTC all your positions?
I sure do. Though it’s more common I will have closed or rolled earlier to move on to the following week.
scubastevo80
Member
Is it the the side taking, or the sidebar conversations that aren't TSLA "investment" related that keep occurring? I like some of the content from the main investor thread (my source of immediate news), but I'm not learning much there. This thread is much more informative to me. I also think they're probably of the view that those of us trading options are not long-term believers in the company (which is probably incorrect). I hold 20x the long equity position vs the small size of cash for options trades I'm doing for my parents.
Back on topic, I'm looking to close my 3 11/19 BPS's on any bounce we may get this week. I'm thinking writing BPS and BCS one to two weeks out and 200pts from any ~3+% moves in a day. Given the intraday volatility over the last week or so that could be coupled with Elon's trading, I'd going to tactically trade these instead of trying to let theta run out and rolling them a day or two before expiry.
Learning a lot here as well. Interesting trade. Is that a 200 wide gap between the BPS and BCS and is this effectively an IC?
scubastevo80
Member
I basically want 20% protection on the top and bottom end and I won't be putting them on at the same time. If we drop from $1000 to ~$950 I'm writing a BPS at 750/650 but won't necessarily write a BCS. If it jumps to $1050 I'll write a BCS. It will depend but I don't want to get caught putting a low premium trade on right before a big move like I did last week since I want to have that ~20% buffer in place. That said, I don't think we go much below $900 in a worst case scenario and I think we're unlikely to see a new high this calendar year.
Thinking the same here. Not sure though whether this week or next week will be the best bet.
Next week we have GF Berlin updates, Thanksgiving and will likely be close to EM completing his sales.
Might just need to do some laddering/tranches and buy some this week and some next week(thought leaning more for next week than this week). Max dip on any given day, might be best time to add a trade.
Most likely Jan 24 leaps. Immediately creating verticals or will wait for share spike before adding the short leg.
Selling some BPS for next week, no BCS for me.(+ don't want reversion to catch be off guard)
Have BPS below 900s for this week (hoping they will stay safe)
+interesting start, was able to get a few as price started spiking... Need to be patient for the rest
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I agree.
Everyone selling CC and BCS here should be modelling based on a scenario where there is an intraday confirmation that Elon is done and the price starts skyrocketing, like yesterday which was quickly dismissed as speculation but still good for 2% in 20 minutes. A 10% move sounds conservative to me. After hours confirmation could be even more dangerous. This WILL happen. Elon will not sell for ever. Don’t get lost in the trees.
I have sold CCs for this week from the last, but they start at 1300. Not brave in the least.
The people that make those comments are just ignorant (when they say this is not how you build wealth). I'm retired, and I'm not selling my core shares slowly for living expenses. Selling options gives me enough income to buy and operate a jet, buy a new boat, buy new Teslas, buy my vacation home, support my children, and eventually help other relatives and give more to charity. That being said, most people that try to do this do lose money - it ain't easy. That is why this thread, and the knowledgeable people here giving advise and sharing their failures, is so valuable. Love you guys/gals.
Yesterday was the last CCs I sold at 15% from ITM. I am going to move away to 30% for next week as I am expecting Elon to finish selling his shares at the end of this week or beginning of next week and then we could see a +10% V recovery. I am forbidding myself to sell close ITM CCs for next week. I even put it in my calendar to remind me what I have not to do on Monday. I understand people who have Iron condors with close BCS legs and can roll them quickly. However I am not ready yet
Yeah, I don't need a bigger account, I need steady income.
That said, we love Tesla! So accounts are not optimized toward either goal.
I am getting to the stage where I have 3 paths I could go down with the weekly profits and I am looking for some thoughts on what strategy others are taking. I do not need the cash I am generating in the next 6 months, longer term I likely will. My current strategy is to sell OTM naked puts backed by margin and cash backed puts with whatever happens to be in the account. The strategy would be as the cash balance grows, sell an extra put. Rinse, repeat.
1) I believe some math was done a few pages ago that highlighted that holding anymore than 1,500 shares and then leveraging that for additional margin purchasing power became negligible. Strategy one, purchase additional shares every chance I get, regardless of margin purchasing power implications.
2) Purchase Jan 2024 1000 LEAPS since I believe we will probably double in value between now and then.
3) Cash gang or pay for living expenses for you others.
I know this is a personal question, but I think it also applies pretty broadly the choices everyone here is making on what to do with the profits. I suspect we all fall into these 3 buckets.
1) I believe some math was done a few pages ago that highlighted that holding anymore than 1,500 shares and then leveraging that for additional margin purchasing power became negligible. Strategy one, purchase additional shares every chance I get, regardless of margin purchasing power implications.
2) Purchase Jan 2024 1000 LEAPS since I believe we will probably double in value between now and then.
3) Cash gang or pay for living expenses for you others.
I know this is a personal question, but I think it also applies pretty broadly the choices everyone here is making on what to do with the profits. I suspect we all fall into these 3 buckets.
Sold -1105/+1205 BCS for this friday for $5.
Premium was good and I believe price will be depressed for the rest of this week.
Premium was good and I believe price will be depressed for the rest of this week.
1) is not correct depending on your brokerage. With Fidelity, if you have 20,000 shares you have 2X the available margin as someone with 10,000 shares. So buying more shares is an option.
I like all 3 of your options, and would consider doing all 3.
AquaY
Member
I never do "All" of anything.
I close out positions that are even remotely in fear of being assigned.
Remember, option holders have up to 1 1/2 hours after close to exercise their options
I also close out positions if i need the margin for other trading.
If I were in your position with that strange glitch I'd probably close out even more positions
I'm torn about rolling my 900/700 to next week. Premium is good enough for me @ $5. But 900 is 12% OTM, and I want to be closer to 20%. That being said, 900 should be close to the floor (I think 850 is the real floor)....
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