Wiki Selling TSLA Options - Be the House

[Oil4AsphaultOnly]

OT
a question, i read a lot of posts here and know enough to know i should not do options and my spouse has forbidden it

does the statement

“ i write OTM puts against my short and which regularly expire worthless i ring the register almost every friday”
make sense?

(this came from a confirmed long term short)

(i have no need to realize any gains so far as other revenue streams are quite sufficient)

I'd throw out one other possible answer: diagonal calendar spread.

The guy/gal could be short via long-dated puts (like how Chanos is "short" TSLA). If that's the case, then they're just opening a debit put spread and letting the short-leg (shorting the option) expire worthless each week. E.G:
- long 600p Jan '2024
- short weekly puts

Not sure if that makes sense financially, just putting it out there how they can be short and sell put options against it.

 

[winfield100]

thanks for the answers folks, i know enough to not join the fray and will simply accumulate

 

[UnknownSoldier]

I have 12/17 BPS -800/+750 out and I'm feeling nervous right now. If Elon is hellbent on finishing his selling before year's end he doesn't have many days left and I really need him not to tank us below 800 before Friday. After that, go ham Elon, I've switched over to 12/23 BCS -1200/+1250 so do your worst. If you're reading this, please and thank you Elon!

 

[intelligator]

There's probably a bunch of these daily, this one stood out. Knowing the price needs to be somewhere in the range to be profitable, what other ways would one profit on a straddle @ 360 for January 21, 2022?

By @generalenthu
Last updated at: 2021-11-26 18:00:59 UTC
volume every minute where volume >= 500 contracts

Minute	price	strike	option_type	Expiry	incVol

14:11	954	360	put	2022-01-21	1180
14:11	954	360	call	2022-01-21	1180

 

[MikeC]

There's probably a bunch of these daily, this one stood out. Knowing the price needs to be somewhere in the range to be profitable, what other ways would one profit on a straddle @ 360 for January 21, 2022?

By @generalenthu
Last updated at: 2021-11-26 18:00:59 UTC
volume every minute where volume >= 500 contracts

Minute	price	strike	option_type	Expiry	incVol

14:11	954	360	put	2022-01-21	1180
14:11	954	360	call	2022-01-21	1180

Could be protecting 1/21/22 360 calls he already owns?

 

[bkp_duke]

I have 12/17 BPS -800/+750 out and I'm feeling nervous right now. If Elon is hellbent on finishing his selling before year's end he doesn't have many days left and I really need him not to tank us below 800 before Friday. After that, go ham Elon, I've switched over to 12/23 BCS -1200/+1250 so do your worst. If you're reading this, please and thank you Elon!

There is a silver lining to this . . . which I have been considering. Don't recall if I mentioned it here, so will toss it out now. Sorry if I have said this before.


There is a tax benefit to rolling a BPS that is negative into next year. I'm looking at multiple 900/950, 910/960, 920/970, and 930/980 all expiring on 12/17. Needless to say I took a lot of "unrealized" losses today.

I'm considering rolling all of those, for break-even or more premium, and at the same or lower strikes, into Jan 2022. By doing so I would realize a large 6-figure loss this year, with the opportunity to recoup that next year whenever TSLA bumps back up and the BPS's can be closed out for profit.

Not advice, just my musings.

 

[generalenthu]

There's probably a bunch of these daily, this one stood out. Knowing the price needs to be somewhere in the range to be profitable, what other ways would one profit on a straddle @ 360 for January 21, 2022?

By @generalenthu
Last updated at: 2021-11-26 18:00:59 UTC
volume every minute where volume >= 500 contracts

Minute	price	strike	option_type	Expiry	incVol

14:11	954	360	put	2022-01-21	1180
14:11	954	360	call	2022-01-21	1180

Good catch. There was a similar sized trade about 20 minutes earlier with the 500 strikes at a somewhat similar size.

There are some box strategies that dealers put in place to mitigate some idiosyncratic risks. In this case I suspect it's a synthetic long (a long call and short put) paired with a synthetic short (long put and short call)

I understand these are pre-negotiated and traded on exchange. Not sure there's much to read in this though.

 

[BornToFly]

25% of my BPS are 700/1000 for 12/17. I can easily roll them for a nice profit to 12/31 or 1/7/22. But, if the SP drops to 750, it is going to get expensive to keep rolling after that (A drop to 850 lets me roll out at no cost). I can't decide if I take the gamble or just go for a safer roll down to 700/900 for a modest debit. The roll down also increases my margin to buy back those pesky CCs I sold after the Hertz fiasco if the SP drops enough that they finally get back close to even. Decision, decision.... I don't want to be greedy, but I also feel like 1000 should not be a problem by the end of the month!

 

[TheTalkingMule]

I have 12/17 BPS -800/+750 out and I'm feeling nervous right now. If Elon is hellbent on finishing his selling before year's end he doesn't have many days left and I really need him not to tank us below 800 before Friday. After that, go ham Elon, I've switched over to 12/23 BCS -1200/+1250 so do your worst. If you're reading this, please and thank you Elon!

I have some 940/840 BPS that I'll roll to next week if I think there's a chance we dip further. The premium rolling to the same strikes was $6 at one point today and ended up around $8. I'll be looking for maybe $9 tomorrow if things stay flat to slightly down. Not bad!

I'm of the opinion these can be rolled for more premium until we pop within a couple months, whether that's Austin/Berlin opening or 4Q earnings. Obviously there's some risk of a pop never coming.

 

[generalenthu]

With Elon getting done with one more tranche today, I suspect tomorrow should be a decent recovery day with IVs trending down all day. At least that was the outcome the day after his sales last week.

That'd make tomorrow morning a great time to roll, except that majority of my short strikes are 950 for 12/17 and there's still too much time value in them. Time to go on a late night date with models I suppose.

 

[bkp_duke]

With Elon getting done with one more tranche today, I suspect tomorrow should be a decent recovery day with IVs trending down all day. At least that was the outcome the day after his sales last week.

That'd make tomorrow morning a great day to roll, except that majority of my short strikes are 950 for 12/17 and there's still too much time value in them. Time to go on a late night date with models I suppose.

My only concern is best estimates are he has 4 more tranches of options to exercise if he wants them all done by 12/31. That doesn't leave a lot of trading days for him to continue, and that means potentially a lot more downward pressure from these sales. Two weeks are likely to see 2 sales of tranches.

 

[OrthoSurg]

Friday, I bought back my -p950 put for a 85% profit when the stock went up.
I almost sold back some puts in the 900s because I am expecting a run up pre earnings however I already have one expiring at the end of the month with a 975 strike price which doesn’t seem to be doing so well.
Friday, I sat on my hands and today I was more conservative and sold 20x 17/12 -p840 puts instead.

If we went from 900 to 540 last time, could we go from 1240 to 745? Sorry, I am a simple man, I use rules of three everywhere I have plenty of margin to roll but I prefer to think we are on the last few days of that mini bear cycle. I was scared to sell CCs the 2 last weeks, on the retrospect, I seem to never get the direction right.

The highlight of my day, sold a stock a friend told me to buy last week because they would get a patent approved for a coughing inhibitor pump: NASDAQ:BLU NASDAQ:BLU - Google Search
First time I buy a stock and it goes up 50% in one day. That was a fun joyride, bought at $6.50 and sold at $12CAD. All my other stocks were deep in red. Enough speculation from my ARK self made funds.

 

[vikings123]

Monday(11/8): Monday, Tuesday(11,15,11/16): Tuesday(11/23): Thursday(12/2): Thursday(12/9): Monday(12/12)

We all look for patterns in charts so I went looking for patterns in Elon exercising his options

MMTuTuThThM?????

Assuming this pattern repeats there’s likely another 5 tranches of option exercise/selling left? It will get him close to the 17 million(precisely around 16.7 million shares) that people think Elon is looking to sell. Lol I have too much time on my hands. But if the above pattern has any truth to it then I think the next tranche is next Monday?

It’s tough to believe Elon will let these hedge funds front run and essentially give them an open book to manipulate the stock in this manner. So may be there is a surprise in store or he just does not care.

If he sells tomorrow then the pattern above is invalidated.

Patterns or not I would urge caution tomorrow. I have no doubt we will gap down tomorrow unless there is major news.

 

[generalenthu]

Interesting stat.

https://twitter.com/x/status/1470586970321522689

 

[M3Rider]

My only concern is best estimates are he has 4 more tranches of options to exercise if he wants them all done by 12/31. That doesn't leave a lot of trading days for him to continue, and that means potentially a lot more downward pressure from these sales. Two weeks are likely to see 2 sales of tranches.

Per Gary, insiders can’t sell 2 weeks prior to Q end. So, with Elon’s having 5m left to sell, he’s got this week left. Which means he either sells 5m in 4 days if he planned for this in Sept (seems apocalyptic) or moves 5m to 2022 or to a secondary offering.

I’m thinking 2022.

 

[generalenthu]

Per Gary, insiders can’t sell 2 weeks prior to Q end. So, with Elon’s having 5m left to sell, he’s got this week left. Which means he either sells 5m in 4 days if he planned for this in Sept (seems apocalyptic) or moves 5m to 2022 or to a secondary offering.

I’m thinking 2022.

I don't think the 2 weeks prior to qtr end rule applies to 10b5 sales. These are setup in advance and could happen anytime.

Happy to be corrected if anyone can show language to the contrary.

 

[bkp_duke]

I don't think the 2 weeks prior to qtr end rule applies to 10b5 sales. These are setup in advance and could happen anytime.

Happy to be corrected if anyone can show language to the contrary.

Correct per my understanding as well. "Pre-planned" sales filed long in advance circumvent the normal closed windows to executives.


Premarket not looking good, if the continues I'll have to implement my planned roll and realize the loss for tax purposes.

 

[scubastevo80]

As we sit on 3 BPS with upper strikes between 900 and 870, one can't help but ponder next steps if we close the week around $900. Do we can close the BPS and roll into shares or LEAPs to take advantage of our view that there will be some form of upside run towards the Q4 earnings announcement and product roadmap date? Or do we start writing BPS down into the 800s assuming IV stays high. Decisions decisions...

 

[strago13]

I am likely going to roll my 950 and 930 12/23 puts to 1/7. I am using about ~50% of my margin and have some cash in reserve in cash things go sour.

 

[UltradoomY]

Still holding my 12/17 BPS for 980/780 and not sweating it much since IV was higher last week and some theta burned off - I am still up 55% with the SP at $983
Will probably look for a rebound / close out tomorrow or Wednesday unless we dip down to around $950 - and then I would look for a good roll.

With 12/23 a short trading week I would be looking for max improvement instead of credit and hopefully an early close if we pop up around $1050.
Hope everyone is fairing better today!

So pondering this morning what to do with these 980/780 BPS...
Yesterday we got close and even touched $950 and I decided to let it sit.
This morning it looks like we are going to open around $940ish and I wanted to go for max strike improvement but.... having experience with DITM puts from a month or so ago when I sold $1200's that stayed ITM, I realized it's no big deal as long as there is some time value left in them, and when we had a strong up day I could close them out for cheap, because they didn't have too much time value in them.

So changing it up from yesterday, either this morning or sometime today, I will look to roll for credit and not strike improvement to next week.
Maybe some improvement if it's available but if not no worries.

Let's see how this goes... I have a Tactical meeting to run right at market open......