Sorry for the confusion! I should clarify in the book that Spitznagel was referencing puts on the S&P index, not specifically puts on TSLA stock. So those numbers are calibrated for the S&P market hedging.
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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Sorry for the confusion! I should clarify in the book that Spitznagel was referencing puts on the S&P index, not specifically puts on TSLA stock. So those numbers are calibrated for the S&P market hedging.
Isn't 200 basis points like only 2%?
Not including TSLA, just using Jim Cramer's strategy (where I first learned of it) of "establishing a baseline, then adding to a position on down days, and trimming it on up days" have allowed me to beat the S&P (over a 12 year span) by 3%. Throw in TSLA and the Buy-n-Hold strategy, and Mark Spitznagel's strategy doesn't sound like it's worth the trouble.
I hope you're not trying to sell something, because that would be going against the rules of this forum (let alone the intent of this thread)?
mickificki
Member
I just found out I can sell/buy calls and puts on my 401k. 
I think I’m in trouble.
STO 2x c735@$6.20. Dipping my toes again…
I think I’m in trouble.STO 2x c735@$6.20. Dipping my toes again…
I just found out I can sell/buy calls and puts on my 401k.
STO 2x c735@$6.20. Dipping my toes again…
Who do you have your 401k with haha?
pz1975
Active Member
Although we will likely finish the week near $730, I rolled my $730 covered calls for this week out to $750 next week to be safe. I had to sell 25% more to get the same total credit but I like having that safety margin as I don’t like how loss builds fast when a sold position gets ITM.
On the subject of Leaps - I would expect as the IV stays at a constant low in the near term which we have seen for 3 months now, IV going from 50 to 40 and now around 30, wouldn't that start to trickle out to the longer expiration contracts as well.
Sure it takes longer for it to go down, but I would expect as TSLA continues to consolidate and move up that the long term contracts will come down in value relative to their strike and once well in the money will trade in lock step with the share price only adding time value.
So a June 23' $900 that has an IV currently of 52 and is currently priced at around $135 - should trend down to around $115 with an IV of 40 and $100 with an IV of 30.
That is until it goes well in the money at which time it will move with the underlying.
Again, these are musings but it seems like it makes sense in my mind - that IV being low on weeklies, will translate out to monthlies and then leaps bringing their costs down.
Sure it takes longer for it to go down, but I would expect as TSLA continues to consolidate and move up that the long term contracts will come down in value relative to their strike and once well in the money will trade in lock step with the share price only adding time value.
So a June 23' $900 that has an IV currently of 52 and is currently priced at around $135 - should trend down to around $115 with an IV of 40 and $100 with an IV of 30.
That is until it goes well in the money at which time it will move with the underlying.
Again, these are musings but it seems like it makes sense in my mind - that IV being low on weeklies, will translate out to monthlies and then leaps bringing their costs down.
InTheShadows
Active Member
Wow we closed above 430! I hit 155.8% of my weekly goal today. Reopened about half of my put spreads. I did not sell any calls last week and didn’t today either.
As others have mentioned I am perplexed by the behavior of the leap calls.
As others have mentioned I am perplexed by the behavior of the leap calls.
Welps, it's looking bad right now. But will stick to the formula and wait until Thursday to consider rolling.
A small view into the IV-Viewer:
yellow is IV for Sep, 17, Brown is for March '22.
IV will trend lower up to 750 for Sep, up to 1050 for March '22. All these are if the price drifts there slow & steady. IV gets spooked by fast rises/falls.
Well I would hope so!
LN1_Casey
Draco dormiens nunquam titillandus
Welp, looks like I'll be selling puts come next week.
Looked at the Max-pain chart this morning, and wow, that wall at 710 is GONE. Guess I should have waited to sell the call, but meh. What done is done, and it's still a profit.
Looked at the Max-pain chart this morning, and wow, that wall at 710 is GONE. Guess I should have waited to sell the call, but meh. What done is done, and it's still a profit.
Well…I finally sold some calls today 5X Sep 10 750 calls for 7$ each, 5X Oct 1 800 calls for 8$ each. Also sold 3X sep 10 700 puts for 8$ each.
There is an obviously strong momentum in the stock and my guess is we will see 750$ tomorrow for sure. Might roll the 750 calls if we end up around 750 for this week.
There is an obviously strong momentum in the stock and my guess is we will see 750$ tomorrow for sure. Might roll the 750 calls if we end up around 750 for this week.
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Sold 10x lcc 730c @8$ today as well..
they are against a 17/9 700c. I would prefer to not have them called away - on the other hand they got a lot of time-value added today (12$ currently, will be roughly 10$ on friday if SP stays ~730).
Scenarios:
SP ≤ 730:
8k in the bank, nothing called away, fine.
SP > 730:
Option 1: call away against the 700c: in total ~19k in the bank, but 700c gone, so i would have to open it again if i still want to CC against it until 17/9
Option 2: roll 1 week out to something like 750 for "free", collect the 8k if SP ≤ 750 next week
Option 3: roll 1 week out to 730$, collect another 6k. Could end up similar to Option 1 if SP ≥ 730, because ~4k should be roughly the time-decay on the 700c in that timeframe.
I think i have to ponder this more.. but Option 3 tomorrow/wednesday when SP stayes ~730 (or rises) sounds like the best thing to me. Especially that it gives the SP time for a small pullback to close it out with good profit.
What would you do?
PS: Hit my goal of beating TSLA-Point-Gain today.
TSLA is only up $18.99, but my portfolio is up 20.12%
Such days are rare ..
they are against a 17/9 700c. I would prefer to not have them called away - on the other hand they got a lot of time-value added today (12$ currently, will be roughly 10$ on friday if SP stays ~730).
Scenarios:
SP ≤ 730:
8k in the bank, nothing called away, fine.
SP > 730:
Option 1: call away against the 700c: in total ~19k in the bank, but 700c gone, so i would have to open it again if i still want to CC against it until 17/9
Option 2: roll 1 week out to something like 750 for "free", collect the 8k if SP ≤ 750 next week
Option 3: roll 1 week out to 730$, collect another 6k. Could end up similar to Option 1 if SP ≥ 730, because ~4k should be roughly the time-decay on the 700c in that timeframe.
I think i have to ponder this more.. but Option 3 tomorrow/wednesday when SP stayes ~730 (or rises) sounds like the best thing to me. Especially that it gives the SP time for a small pullback to close it out with good profit.
What would you do?
PS: Hit my goal of beating TSLA-Point-Gain today.
TSLA is only up $18.99, but my portfolio is up 20.12%
Such days are rare ..
AquaY
Member
Everything depends on what your short term outlook is.Sold 10x lcc 730c @8$ today as well..
they are against a 17/9 700c. I would prefer to not have them called away - on the other hand they got a lot of time-value added today (12$ currently, will be roughly 10$ on friday if SP stays ~730).
Scenarios:
SP ≤ 730:
8k in the bank, nothing called away, fine.
SP > 730:
Option 1: call away against the 700c: in total ~19k in the bank, but 700c gone, so i would have to open it again if i still want to CC against it until 17/9
Option 2: roll 1 week out to something like 750 for "free", collect the 8k if SP ≤ 750 next week
Option 3: roll 1 week out to 730$, collect another 6k. Could end up similar to Option 1 if SP ≥ 730, because ~4k should be roughly the time-decay on the 700c in that timeframe.
I think i have to ponder this more.. but Option 3 tomorrow/wednesday when SP stayes ~730 (or rises) sounds like the best thing to me. Especially that it gives the SP time for a small pullback to close it out with good profit.
What would you do?
PS: Hit my goal of beating TSLA-Point-Gain today.
TSLA is only up $18.99, but my portfolio is up 20.12%
Such days are rare ..
For me, I'd choose option 2 in case we have a further run up to resistance which I believe is like $750.
Then I;d make other trades as I saw fit
Just my 2 cents
InTheShadows
Active Member
Omg, that’s worse than the $700 comment in the main thread.Well I would hope so!
Thanks guys for bringing up the LEAP crush. I noticed it on my 6/2023 $1000C as well...
Flipped a few $740 and $750 CC. Booked about 20% profit throughout the day. Have few open for now for same $740cc and 750cc.
Volume on 750cc is 150k! Never seen that many before....
Flipped a few $740 and $750 CC. Booked about 20% profit throughout the day. Have few open for now for same $740cc and 750cc.
Volume on 750cc is 150k! Never seen that many before....
Will be interesting to see, how many will stick.
We had 18k open today. I think this will increase significant tomorrow & make it an even harder wall for the MMs
Sold 10x lcc 730c @8$ today as well..
they are against a 17/9 700c. I would prefer to not have them called away - on the other hand they got a lot of time-value added today (12$ currently, will be roughly 10$ on friday if SP stays ~730).
Scenarios:
SP ≤ 730:
8k in the bank, nothing called away, fine.
SP > 730:
Option 1: call away against the 700c: in total ~19k in the bank, but 700c gone, so i would have to open it again if i still want to CC against it until 17/9
Option 2: roll 1 week out to something like 750 for "free", collect the 8k if SP ≤ 750 next week
Option 3: roll 1 week out to 730$, collect another 6k. Could end up similar to Option 1 if SP ≥ 730, because ~4k should be roughly the time-decay on the 700c in that timeframe.
I think i have to ponder this more.. but Option 3 tomorrow/wednesday when SP stayes ~730 (or rises) sounds like the best thing to me. Especially that it gives the SP time for a small pullback to close it out with good profit.
What would you do?
PS: Hit my goal of beating TSLA-Point-Gain today.
TSLA is only up $18.99, but my portfolio is up 20.12%
Such days are rare ..
Keep in mind what would happen if the SP went to 800-900+ quickly.
You end up in a position where you can’t roll the 730 up anymore and the weekly option price catches up to your 700 LEAP. Even rolling it to the LEAP exp date might only get you to 735 or 740, so just like that your 700 LEAP turns into a 700 - 740 spread, for just a few hundred bucks gain.
I think this is the major drawback selling LCC vs CC. It happened to me in 2020 and so I always roll aggressively now. This is TSLA, one of these days we’re going to get a crazy run, the big question is whether it’s already started.
InTheShadows
Active Member
This is why I did not sell any calls today. I wrestled with it shortly after lunch time, then it kept going and I remembered last fall when we were gapping up $20-30 every day. Big moves during the day can be dealt with with conditional orders and by watching the ticker, gaps are another story. What if we gap up to 750 tomorrow, or down to 710? How would you handle it? I have 610/710 put spreads being my most aggressive, I'm not concerned because I think the consolidation phase is ending and we are going to break up.
We closed above 730 (I got it right that time
, macd crossed today, our next resistance if we open above 730 is 750 then ~780ish. The 780's were what I considered earlier today. for .75 though, I chose not to. Briefly considered buying one, then went to last years trading log to look at how much I lost buying otm weekly calls to bring me back to probabilities.The 700s are expiring in 3 weeks anyway, so I would have to roll/close them soon ..
Currently they form a diagonal bull call spread. If so spikes to 800, then I cannot roll & would have to close for a measly profit of 19k this week.. instead of the 70k I would have gotten on the calls alone .. but on the other hand: 800 by Friday? I don't think so, Jim
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