Wiki Selling TSLA Options - Be the House

[Yoona]

i am very tempted *NOW* to STO 4/8 -p940/+p840, credit $2.50, 6 delta, 14% OTM

reasoning: if sp falls, maybe 3 lines will defend it (10SMA, 100SMA, 50SMA)

 

[EVCollies]

Nice. Stick to the safe stuff. I thought I was coming out of retirement with the drop in February....

And I thought I was going into retirement in January...

It was my best month, felt sure I would weather to SP drop, but kept dropping.

February wasn't too bad early on, still able to roll those pre Elon stock sale BPS with the occasional uptick in SP, but eventually margin calls started triggering stock sales and a roll forward a couple of months.

March was licking my wounds, found some dry powder, made a little money.

April looking better but with my BPS rolled to 5/20, might be my worst month.

But I haven't lost any cash and will look forward to May.

 

[samppa]

so what do you guys here think about coming p&d report and sp reaction?
Right now I'm inclined to not open any short term positions here.. we've been on a run up for a while, so p&d could cause a large drop.. or a massive beat could send stock to moon.
Pity to miss out on that iv crush though.

I don't even know what kind of numbers to expect.. been too busy renovating my sauna at my island cottage, gotta get it done before the sea ice melts.

 

[BornToFly]

so what do you guys here think about coming p&d report and sp reaction?
Right now I'm inclined to not open any short term positions here.. we've been on a run up for a while, so p&d could cause a large drop.. or a massive beat could send stock to moon.
Pity to miss out on that iv crush though.

I don't even know what kind of numbers to expect.. been too busy renovating my sauna at my island cottage, gotta get it done before the sea ice melts.

To be safe, you would probably need to be 20% OTM on both sides. If it moves up or down 5-10% Monday morning, I think you will make more money opening contracts Monday morning into strength. That is my plan anyway. IV crush only works if the SP stays flat, which is no longer the TSLA way....

 

[EnzoXYZ]

Just opened 930 BPS for next week. Hope to open more on a drop tomorrow if we get one. As always -Selling into strength.

 

[BornToFly]

Decided to add +1030 and +1160 to make IC for $2.60. Now I hope that if my stop losses get triggered on the short legs, that the long legs will get the original premium of the short legs back and limit the total possible loss.

Closed the positions for a 26% profit. Didn't want to let it stand overnight in case it opened higher or lower and jumped over my stop loss order.

 

[intelligator]

Watching volume and narrowing of daily range, I STO an experimental ratio call spread 1x +1125C 3x -1150C for 6.97 with the price at 1106 or so on Wednesday. Wanted to do it Tuesday of this week but wasn't comfortable, so held out until I was. BTC today for .23 ! I was going to wait out until Friday for the possibility of close closer to 1150, which would have increased the value of the long call significant. Decided to not play that game when 97% is staring at me.

 

[mickle]

Today I opened some 700/900 BPS for 4/8, got about $1.60 for them. Not sure about how good P&D numbers will be this weekend, but I'm expecting we'll get a pop after Elon talks at the Cyber Rodeo on Thursday. Will try to open some more BPS tomorrow if possible.

 

[MP3Mike]

I've got some 935 CCs and 980 CCs, and I can't decide if I want to roll them week-by-week hoping to close them sometime soon, or if I should roll all, or most, of them to Jan23 1325s and 1425s...

I do have some short-term need for tax money, which would either require selling some shares or selling ITM BPSs to get the cash.

I feel like I need to take action tomorrow, because the upcoming catalysts could cause the price to spike and cut-off some escape options.

Anyone have some not-advise? (I'm leaning toward the long roll as it relieves some of the stress from weekly management.)

 

[vikings123]

I've got some 935 CCs and 980 CCs, and I can't decide if I want to roll them week-by-week hoping to close them sometime soon, or if I should roll all, or most, of them to Jan23 1325s and 1425s...

I do have some short-term need for tax money, which would either require selling some shares or selling ITM BPSs to get the cash.

I feel like I need to take action tomorrow, because the upcoming catalysts could cause the price to spike and cut-off some escape options.

Anyone have some not-advise? (I'm leaning toward the long roll as it relieves some of the stress from weekly management.)

Why not roll them for puts(assuming you have margin)?

I have a few ITM CCs that I would like to rescue too but these are in IRA so have to roll to a future CC.

Not advice but I plan to not do anything to them until next week. I doubt there will be a spike next week, imo a good P&D number is already factored in. If anything I think we could see a sell the news.

Full disclosure: I was predicting a sell the news on Berlin opening. Look what happened lol.

 

[MP3Mike]

Why not roll them for puts(assuming you have margin)?

Margin is tight right now, since I have some BPSs that I rolled forward to try to save them...

But do you have a suggestion for what that would look like? Are you thinking about something like for each 935 CC that I replace it with 3x May'20 1010/1110 BPS? That puts double the current value of the call at risk, $30k vs $15k, but it could all be over in a month and a half... I would hope we are over 1110 by then, but I'm not sure...

 

[vikings123]

Margin is tight right now, since I have some BPSs that I rolled forward to try to save them...

But do you have a suggestion for what that would look like? Are you thinking about something like for each 935 CC that I replace it with 3x May'20 1010/1110 BPS? That puts double the current value of the call at risk, $30k vs $15k, but it could all be over in a month and a half... I would hope we are over 1110 by then, but I'm not sure...

I was actually talking about cash or margin secured puts. Something like a Aug 1050 or a Nov 1000 would probably get you close. Or perhaps a combination of BPS and puts. I think you can get creative.

 

[juanmedina]

Personally I consider steady buying pressure will happen all the way through September now with the stock split intent announcement. All the share manufacturers will need to wind down those positions. Those buys of stock will have the secondary effect of shrinking the float, further pushing up the share price. With the financials being what they've been and what I anticipate I don't consider $2000 this year unreasonable (maybe not likely, but I wouldn't take on a position in which complete wipeout was dependent on that not happening).


Are those covered calls or are they call spreads? If they're covered calls then one choice is to just decide you'll sell at that 1200 to 1300 strike for now, and then wait for a better share price sometime later or at least close enough come December. I've been pretty DITM and been able to roll 1-2 years for a huge strike improvement and a small credit.

The basic problem with rolling December options today is that you've got a lot of time value in that position right now (its all time value right now). On a roll you will, in effect, start by buying out that time value. Then you get to sell the time value in the new position. Out in that 6 - 24 month timeframe time value definitely continues increasing but that rate of increase slows down. Going from 8 months to 16 months won't double the time value.

The other problem is that you can't add that much time to a December option. You can go out to June '24 right now - that'd add about 18 months to that 8 month position.

You don't mention whether the shares are on a schedule for when they need to be sold. If there is a definite resolution time that will affect available choices.

Oh - and I would only roll for a credit unless a position is really desperate. $100-200 OTM, even with far DTE, isn't desperate (MHO). It might not be ideal but that is a big difference.


I guess my not-advice for the moment is pretty simple. Do nothing (assuming these are share backed covered calls). For this position in particular, hope for sideways trading for another quarter (maybe 2). I definitely wouldn't pay $40/share to add $100 to the strike and a year to expiration.

If you think that the shares are about to pop and run with production and they won't be coming back to this level again - maybe the new trading range is about to become 2000-2500 - then taking the loss with the plan on recouping it by the shares running like crazy is something to consider. My view, while bullish, isn't this bullish

Sorry you are here, first off.
Price Target for January 2023 is $1800 (not split adjusted) because of the upcoming stock catalysts.
These are not company wise catalysts, just what's important for the Street.
Earnings growth in Q2 and Q3 over Q1 is going to blow past all covering persons and companies.
Stock split (announcements) over the next couple of months will make short sellers more wary giving us a closer approximation to real value.

Additionally, I think that we cross the analysts targets at the end of Q3... Meaning we have already had more than $12 per share for Q1/2/3 and delivered more than the 1.4M vehicles that everyone is saying TSLA will do in a full calendar year.
So then we end up with a "Free Quarter" where none of the still accelerating growth is accounted for, end of year window dressing, investment grade from rating agencies, etc.

This is conservative and can be thought of as a safe number because of inflation and recession risk off, but the money still has to go somewhere.

With that being said, and since it's not advice... I am writing aggressive puts 2 weeks out ATM and will keep doing so. New June 2024 options were just listed, so that might be an option to look at for a roll?

Thank you both. The stock split was a curve ball that was not expecting and it changes everything. At $1800-2000 Tesla would be a 1.86-2B+ company. I think I am going to wait out and see if I can close the calls for a minimal loss. Troy's P&D number look too close to the consensus and I would expect a sell off if they are accurate but as usually who knows what will happen.

 

[OrthoSurg]

And I thought I was going into retirement in January...

It was my best month, felt sure I would weather to SP drop, but kept dropping.

February wasn't too bad early on, still able to roll those pre Elon stock sale BPS with the occasional uptick in SP, but eventually margin calls started triggering stock sales and a roll forward a couple of months.

March was licking my wounds, found some dry powder, made a little money.

April looking better but with my BPS rolled to 5/20, might be my worst month.

But I haven't lost any cash and will look forward to May.

2 colleagues of mine started doing medico legal expertises for companies stucked with injured workers for over 1 year. They have my name last September, I met the president of the company who wanted me to start right away because they had an incredible surge of demand from low back sprains with about 20% of absent employees in the hospitals. Then the SP surged in October and I didn’t give any availability. With my recent portfolio debacle, my wife gave them 3-4 days a month in my schedule. She is punishing me and now I get to hear a whole day of workers complaining against their employers and how they hate their job. Yesterday was my first day of medicolegal expertises. Now I finally get to complain I hate my job to my wife.

As soon as my portfolio recovers to previous levels from selling 25% ITM puts every 6 months, if it ever recovers, it will be the first thing I retire from Lately, we have been given some extra OR time so I am finally working 3-4 days a week at the hospital instead of 1-2. I have less time to check the SP and I found out I am happier with selling my far 90 DTE 25% ITM Puts . However they have been OTM for the last week

Safe day trading everyone. I was forced to retire from that too when I rolled out and away my 20% OTM CCs that got ITM at 900/990/1035.

 

[CHGolferJim]

Any general thoughts/non-advise about rolling DITM longer-term covered calls? I have 0520-C$980 and $1000, and 0819-C$1000 and $1100, and have been looking at 2-3 week rolls for about a week. Nothing jumps out at me other than the usual trend that rolls get less effective as the SP rises.

Today
- looking at pros and cons of rolling some of these into long-termers I might be able to forget about
- wouldn’t mind having some assign at $1100 asap
- getting twitchy not being able to generate income the last few weeks.

 

[juanmedina]

Any general thoughts/non-advise about rolling DITM longer-term covered calls? I have 0520-C$980 and $1000, and 0819-C$1000 and $1100, and have been looking at 2-3 week rolls for about a week. Nothing jumps out at me other than the usual trend that rolls get less effective as the SP rises.

Today
- looking at pros and cons of rolling some of these into LEAPs
- wouldn’t mind having some assign at $1100 asap
- getting twitchy not being able to generate income the last few weeks.

isn't weird? it's an addiction

 

[Yoona]

closing my IC now; 4/8 will probably be +p800/-p900/-c1300/+c1400, 17-20%OTM... not sure yet but STO is next week

 

[adiggs]

Interesting situation. I think if I was in the same boat, I’d probably take half the exposure off the table (primarily from the leveraged part) and leave half for Monday. It would depend on what the alternatives and timings are for raising the remainder of the lump sum needed. I’m starting to think it’s 50/50 whether P&D will impact SP. On the one hand, WS is bringing down their consensus production projection re Shanghai closure (reported by G. Black), but we know that will have limited impact on deliveries. So the chances of a down day are reasonably significant.

I’m considering a BTC on 6 DITM 5/20 calls on Friday hoping for a strong chance of a price bump Monday AM —> resell/roll for better terms than doing both Friday. This would worked beautifully in recent weeks, but I was chicken. I’m just not that confident of enough of a beat to impact SP. Perhaps a Friday downtrend could impact the decision.

I ended up closing all of the shares needed for the tax event, 2/3rds of those June 750s, and the first unit sale or "assignment" in the last account. These sales were with shares around 1092. So far I'm looking brilliant . Whatever happens from here, taking a lot of the current state of a nearly 1100 share price makes me happy, even if shares hit 1200 on Monday.

More on "assignment" below.

Today
- looking at pros and cons of rolling some of these into long-termers I might be able to forget about
- wouldn’t mind having some assign at $1100 asap
- getting twitchy not being able to generate income the last few weeks.

Regarding assignment, though I talk about getting assigned on puts and calls as part of my own macro wheel strategy, as a mechanical matter I expect that I won't ever take actual assignment. Rather when I talk about assignment, what that really means is that when I decide to buy or sell shares, I won't be waiting for expiration. Rather I'll actively buy out the short option and simultaneously buy/sell the shares at some point when the remaining time value in the short option is low. At a guess that'll be $1 right now for me, but I'm not fixed on that.

Example - I sell a 1000 put (I have some of these open right now) and shares fall to 900. I'm $100 ITM and I decide(d) that I want assignment on 1 of those 1000 strike puts.

I can wait for assignment, or I can execute the combo order any time. For April 8 expiration my guess is there's $2 worth of time value (making up #s now to illustrate the idea). I can close 1 of those short puts and buy 100 shares for just over $1000; probably $1002. That'll come from:
- buy 100 shares at 900
- btc 1 csp at ~$102

I probably enter the combo order for around $1001 - pay the $1 to actively close the position sooner. Remember that I decided I wanted the 1000 strike put assignment (in this made up example) - I don't need to wait for actual assignment unless I want to earn that last $2 worth of time value.

 

[scubastevo80]

We sold 4/1 -1025/+925 BPS at the open for $0.53 and I have a BTC order at $0.03. Rationale: it's all about P&D numbers tomorrow. I expected us to trade in line or above macros - down no more than the NDAQ and possibly between the open and $1100 or so. Was happy to recover $50 on our way back to breakeven after a rough January (BPS related) and late March (call spread related).

I have no 4/8 trades on - waiting on P&D numbers and will trade accordingly 20% out. Similar to Yoona, I'm looking at -900 on the put side and -1300 on the call side, but will open these separately (BPS on a down move and BCS on an upward move)

 

[ninpb]

STO 4/8 1450C for 1.67.

BPS - Bull Put Spread
BCS - Bull/Bear? Call Spread. always forget as I've never done one.

BTC 4/8 1450C for .36 at morning dip for 78% profit in 3 days with 7 DTE. That split tweet +10% move really helped with opening this 35% OTM.