Wiki Selling TSLA Options - Be the House

[ZeApelido]

Still can't get the idea out of my head.. so my head searches for solutions.

One idea i just had:

Making a Fund is slow, expensive and a legal hassle.

What if we together do "algorithmic trading". I have the expertise & knowledge to write software for this. Every major broker with their client-software offers plugins or similar to interface (and even do trades!) via external programs. To be on the safe side legally i devised this plan:

- Participating members install a program on their pc to control the trading & an app on their phone.
- vetted TMC-Mebers can suggest trades onto that group in real-time (or you can add a whitelist).
- you get a notification on your phone for a trade with some basic info:
- what
- P/L-diagram
- reasoning
- additionally an "always trust this person"-option.
- you can then accept the trade on your phone anywhere so even time-critical trades are possible
- the trade-order gets send to the program running on your pc while you go on with your normal life (and jobs .. )

Legally you STILL do the trade. I don't know if that counts as "financial advice" and how you get around THAT legally .. but to an onlooker this looks like you are still in control of everything and do all the trades manually.

I have the knowledge (programming-wise) and the infrastructure (server-wise) to get that going.

BUT this depends on a few things:
- I must be able to live from the earnings of this program to dedicate all my time to it & fix problems immediately (think: ~$2000/month are enough)
- Some Members here (looking at you, @Yoona , @BornToFly and others ) must be willing to feed trades into it
- Users must actually be willing to risk their hard-earned money with this.

I can have a prototype ready (interfacing with IBKR as i already have that one going) in about two weeks (calendar-weeks, not elon-weeks ) and would then have to look into other brokerage-softwares (like fidelity or whatever you all use ).


Anyone interested in such a plan?

I have had a slightly different and amusing idea:

We set up a collective "fun" account with small money. Say $1k or even $100 contribution. One person manages the account, but the trade decision are entirely made by the postings in a dedicated thread. Trades are simply made following what the next message in the thread says to do.

So if @adiggs makes first post to buy TSLA shares with the money and immediately write CC's, that's the first trade.

But if 2 hours later @BornToFly says 'close that trade and Jul 22nd, STO 500/700 BPS', that has to be executed.

This opens up some hilarious game theory and psychological experiments, possible bordering on an eventual outright mutiny or Lord of the Flies situation.

I find this highly intriguing!

 

[Nocturnal]

I have had a slightly different and amusing idea:

We set up a collective "fun" account with small money. Say $1k or even $100 contribution. One person manages the account, but the trade decision are entirely made by the postings in a dedicated thread. Trades are simply made following what the next message in the thread says to do.

So if @adiggs makes first post to buy TSLA shares with the money and immediately write CC's, that's the first trade.

But if 2 hours later @BornToFly says 'close that trade and Jul 22nd, STO 500/700 BPS', that has to be executed.

This opens up some hilarious game theory and psychological experiments, possible bordering on an eventual outright mutiny or Lord of the Flies situation.

I find this highly intriguing!

How do we handle taxes though?

 

[UltradoomY]

How do we handle taxes though?

We won't need to worry about taxes since the account would likely be margin called on day 1....

 

[Drezil]

How do we handle taxes though?

and all legalese when having "other peoples money"?

 

[dc_h]

i decided exactly against that. Even with the on -710c i have,

today we had a "perfect storm". Strong macros, massive call-buying, totally in the "gamma-squeezy"-range for tomorrows expiry..
You could see how MM tried to "hold the lid" on it yesterday and today. All the pressures above means that they could only "soften the raise", but will be back with a vengance tomorrow.
Also this feels a bit bull-trappy...

Look at the rest of the industry:
TSLA: +5.6%

old auto:
GM: +4.6%
F: +5.5%
VOW: +6.2%
BMW: +5%
MBG: +6.3%

new auto:
NIO: +9%
BYDDY: +5.3%
XPEV: +6.6%
LCID: + 8.3%
RIVN: +6.8%
NKLA: + 4.8%
SEV: +5.1%
FSR: +4%

we are completely in the middle of the pack. This has NOTHING to do with TSLA-specfics. If tomorrow some manufacturers talk about how hard things are, China coughs a little and lockdowns, powell sneezes at the market or anything .. this can all be erased FAST.

All this - even when oil is up 5% and over 100 again, 10 year trasury yield broke 3% again (up from 2.8x 2 days ago) and other things that were used as arguments why "a recession is coming!!1"..

It just FEELS wrong to be up 5% on that

I kept some 740 for tomorrow, but after getting steamrolled last fall, I'm more comfortable losing a week of premium than selling the shares. I could wheel it, but if we run up to 900, my 740 puts won't bring much premium. The wheel is basically a time delayed straddle and I have not been patient enough to make that work. I chased getting back in after calls were hit last fall and bought in higher. I could have stuck to the wheel and came back in at the same price once Elon started selling. We could be in for a big run up as earnings estimates start firming up for Q3. Once you fall behind the curve it is hard to roll out. Hopefully we will get a nice steady into the fall.

 

[CHGolferJim]

This may have had an impact today.

https://www.washingtonpost.com/technology/2022/07/07/elon-musk-twitter-jeopardy/

 

[mickificki]

This may have had an impact today.

https://www.washingtonpost.com/technology/2022/07/07/elon-musk-twitter-jeopardy/

Faiz Siddiqui...i think he's written some ill-researched articles on tesla in the past...

 

[CHGolferJim]

Conundrum:
- have 7/8 $730 CC which closed at $12.00 today
- during relatively flat periods, usually roll one week and $10
- 7/15 $740 CC closed at $23.50 today
- $11.50 is an unusually good roll credit for 7 DTE/$10
- figure odds of closing tomorrow above $729 are pretty small
- credit has been increasing with SP, so will likely decrease if close < $730 looks likely as tomorrow afternoon unfolds

 

[intelligator]

Conundrum:
- have 7/8 $730 CC which closed at $12.00 today
- during relatively flat periods, usually roll one week and $10
- 7/15 $740 CC closed at $23.50 today
- $11.50 is an unusually good roll credit for 7 DTE/$10
- figure odds of closing tomorrow above $729 are pretty small
- credit has been increasing with SP, so will likely decrease if close < $730 looks likely as tomorrow afternoon unfolds

I saw that earlier as well. I am going to see how the morning goes , ideally have that same 730 CC expire. While the 11.50 is attractive, who knows how fast things can move next week. I'm also thinking we can pickup that same 740 or better strike for similar credit next week. The approach I've taken the past three months is to watch on Monday, pick a strike to sell Tuesday, re-assess Thursday, roll or preferably expire Friday.

 

[chiller]

I have been rolling -p700 for weeks. I was in margin call territory but figured 600 would be the bottom, so I'm keeping the account propped up with 2x +p600 per 1x -p700.
I keep the +p600 a few weeks out, so rolling one week on an up day (preferably when the stock price is way above 700) and rolling the -p700 as late as possible on Fridays.

This has led me to have a large enough margin buffer not to look at the ticker all day. This was important since I have been spending the last month on vacation. The closer we get to 700 near the Friday close, the more credit I get for the roll to next week.

However, I've noticed that the premiums for the 22. are quite high, so it is tempting to roll out two weeks. I'm guessing the increased IV on the 22. is related to the earnings call, but I'm unfamiliar with how that IV will change before the call has happened.
If we end up near 700 tomorrow, I think I could roll them two weeks for around 40.00 credit.

So my question is: If we steer towards a 700 close, should I roll for two weeks for around 40, or should I try to roll one week for 25?

 

[CHGolferJim]

I have been rolling -p700 for weeks. I was in margin call territory but figured 600 would be the bottom, so I'm keeping the account propped up with 2x +p600 per 1x -p700.
I keep the +p600 a few weeks out, so rolling one week on an up day (preferably when the stock price is way above 700) and rolling the -p700 as late as possible on Fridays.

This has led me to have a large enough margin buffer not to look at the ticker all day. This was important since I have been spending the last month on vacation. The closer we get to 700 near the Friday close, the more credit I get for the roll to next week.

However, I've noticed that the premiums for the 22. are quite high, so it is tempting to roll out two weeks. I'm guessing the increased IV on the 22. is related to the earnings call, but I'm unfamiliar with how that IV will change before the call has happened.
If we end up near 700 tomorrow, I think I could roll them two weeks for around 40.00 credit.

So my question is: If we steer towards a 700 close, should I roll for two weeks for around 40, or should I try to roll one week for 25?

If we steer towards $700, roll credits will probably compress (did you take that into account with your 40/25?) and then there’s the possibility of a big stock move happening in next few weeks. Higher DTE means higher risk of going ITM, so less risky strikes may be warranted.

 

[CHGolferJim]

I saw that earlier as well. I am going to see how the morning goes , ideally have that same 730 CC expire. While the 11.50 is attractive, who knows how fast things can move next week. I'm also thinking we can pickup that same 740 or better strike for similar credit next week. The approach I've taken the past three months is to watch on Monday, pick a strike to sell Tuesday, re-assess Thursday, roll or preferably expire Friday.

I may try to capture the $23 with additional contracts and manage the current ones separately (expecting expiry OTM or a lower credit if SP declines).

 

[OrthoSurg]

I am in the kind of mood I have reached the point to sell all my TSLA and buy puts for 500, you know what this means?

That TSLA is about to reverse, finally.

Are we there yet?
Sold 800CCs for next week.
Come steam roll me with all the energy you can TSLA so I can close my underwater puts like there is no tomorrow

 

[JustMe]

Can you expand on what/how you sensed this?

Good question

Mainly based on learnings from HumbledTrader YouTube channel and countless hours watching and trading this stock. I’ll outline my observations that let to my trading decisions below.

The premarket was mildly green across the board and Vix was markedly down, so I expected a neutral to positive day for TSLA from that standpoint. Also no significant Tesla news that I was aware of.

Below is this morning’s opening chart where I have numbered the first ten candles.

Candle 1: first daily candle is often hard to interpret, unless it’s a really massive move.
I waited.

Candle 2: long lower wick suggested strong buying support - quick reversal of selling.

Candle 3: neutral

Candle 4: strong sustained buy on high volume. No upper wick. This was a clear signal to me. I sold bps here.

Candle 5: spinning top type represents market indecision. Possible reversal or continuation. I waited for direction.

Candle 6: solid green, no upper wick, sting buying continuing.

Candle 7: green with lower wick indicated rejection of reversal and continued upward trend.

Candles 8-10: upper wicks, sideways sp movement suggested possible reversal. I took profit here. In other situations I might have waited but 50% profit in 6 minutes is a good win.

Hope this helps

Purple line is VWAP, blue line is the EMA

 

[OrthoSurg]

I much simpler solution is to simply use this forum for real-time information sharing: successful traders, like @Yoona could post their trades when entered, others can follow and copy the trades if they wish at their own discretion. Everyone managing their own money, no legal hoops to jump through.

I would like but my day job doesn’t let me do the trades even if Yoona sent me all the trade alerts. I have 10 minutes of free time per 12 hours day.

 

[Discoducky]

and all legalese when having "other peoples money"?

I'd be fine gifting the money as I'm a trusting person, but I'd start with $100 for a few months and see how it goes.

And it would need to be from a set of trusted/regular folks on this thread, not some rando lurker

 

[Discoducky]

Good question

Mainly based on learnings from HumbledTrader YouTube channel and countless hours watching and trading this stock. I’ll outline my observations that let to my trading decisions below.

The premarket was mildly green across the board and Vix was markedly down, so I expected a neutral to positive day for TSLA from that standpoint. Also no significant Tesla news that I was aware of.

Below is this morning’s opening chart where I have numbered the first ten candles.

Candle 1: first daily candle is often hard to interpret, unless it’s a really massive move.
I waited.

Candle 2: long lower wick suggested strong buying support - quick reversal of selling.

Candle 3: neutral

Candle 4: strong sustained buy on high volume. No upper wick. This was a clear signal to me. I sold bps here.

Candle 5: spinning top type represents market indecision. Possible reversal or continuation. I waited for direction.

Candle 6: solid green, no upper wick, sting buying continuing.

Candle 7: green with lower wick indicated rejection of reversal and continued upward trend.

Candles 8-10: upper wicks, sideways sp movement suggested possible reversal. I took profit here. In other situations I might have waited but 50% profit in 6 minutes is a good win.

Hope this helps

View attachment 825980

Ah, I remember the days when I'd watch the first 1-minute candles, look at maxpain and place weekly bets on CC's.

Those days are coming back though! 800s for me!

 

[Chenkers]

I opened several 760/800 BCS @$0.95 around the time that $725 was meeting sustained resistance. Of course $725 broke soon after and they went well underwater.

I'm not too worried for these at this stage. $737 was strong resistance that reversed the last bear market rally in late June and we seemed to stall around $735 today. This also matches up with resistance levels in QQQ and then we have the strong call wall at $750. Futures are red so far so we'll see how this plays out.

 

[juanmedina]

Maybe another green day? I have 770-780cc

https://twitter.com/x/status/1545346941650968577

 

[Chenkers]

Maybe another green day? I have 770-780cc

https://twitter.com/x/status/1545346941650968577

Seems less likely. The US Jobs report came in at +372,000 vs the +268,000 expected. Futures reacted by dropping sharply just after this came out at 8.30am. I'm assuming this will fuel the hawkishness of the Fed as the jobs market is still healthy and not as close to recession as some thought.