Wiki Selling TSLA Options - Be the House

[Tslynk67]

I am not sure I have the guts for $750 calls. We're coming off a couple weeks where the first call wall didn't quite hold, right? If the market likes what the Fed has to say, there's macro upside potential. $760... $770... that would be easier on my digestion. Honestly $780 would be nice it's just that the current price stinks.

At the same time, I'm frustrated by the put situation. If I rolled to next week right now, I'd make my income goal for the week. It's just that the last two weeks have offered an IV pop late in the week, and I feel like there's a good chance of making more premium with the same rolls later. So I'm trying to talk myself into doing nothing, which as you know I find painful.

Bottom line, I've put in my limit orders and they're not especially close to execution, but we'll see what the rest of the week brings.

I doubt the FED will do anything this week, or even talk about "tapering", to much churn in the markets, but I also think everyone's waiting for Evergrande to default on Thursday, it's expected, but I don't know what the impact will be, might close my puts before then... of course if CN does make some calming moves, it could also pop the stock

But hey, we only do it for the buzz, right?

 

[phantasms]

I am not sure I have the guts for $750 calls. We're coming off a couple weeks where the first call wall didn't quite hold, right? If the market likes what the Fed has to say, there's macro upside potential. $760... $770... that would be easier on my digestion. Honestly $780 would be nice it's just that the current price stinks.

That's where my head is at. I got lucky and sold a $770 at the top today. I'm expecting tomorrow's meeting to be more of the usual and TSLA will launch. I'll sell some 780s and 800s then. The past several weeks were phenomenal. If I don't meet my targets this week due to being careful, well, that's fine with me.

That said, as I'm writing this I'm seeing a complete meltdown on all my charts. Hmmm lol

p.s. Ran 50k on Saturday and only ran 18 miles the past several weeks. The longer the base...! lol

 

[AquaY]

Sold 6X at 5.50, the hedgies better defend it this week

Question: I opened 15X 670/700 BPS and up like 60%. Do you guys typically close it out early or just let it expire?

I personally like 75% but I have no hard and fast rule regarding it. A lot has to do with what I can do with the freed up margin ( or cash)
Sometimes letting then expire worthless or close them for pennies is good. Other times, it would be smarter to close when you're up well 25,50,75% and go onto the next trade. A lot of personal choices to be made and what you think the market and the securities will do

 

[juanmedina]

FYI LCID IV is high maybe there is a play there.

 

[EnzoXYZ]

i opted for 755lcc @~4.00$ .. that is behind the first call-wall of 750.

I opt for 760CC hoping you all hold at 750 & 755. Remember you’ll have ONE job . I’m not looking for max profit as I dont want chase just before Q3 reports and other huge events in October.
On the BPS I did 5x 700/650 which been more aggressive than my usual (680 max).

 

[EnzoXYZ]

I have several BPS on for Friday. Highest strike short are just 5x 715 puts
Biggest position total 95X +580/ 680s which I added 10 x to this morning at a $2.04 credit
Overall, I’m up 65% on that position.
I’m in good shape right now and will start closing some tomorrow or Thursday when I feel strongly about the next few weeks and want to set up more positions for those expirations.

I’ve held off on calls. Just not feeling the love at this time

Agree. I like to set up some bigger BPS bets for early October. I usually stay far away from ATM.

 

[BornToFly]

Some of you are MUCH braver than me with the 750 calls! I was nervous until recently about my 820s for Friday....
I don't trade in a tax-free account, so if my shares get called away, my tax bill will kill me and prevent me from buying the same number of shares back. I would be very nervous about anything below 800 for end of next week.

 

[Tslynk67]

Some of you are MUCH braver than me with the 750 calls! I was nervous until recently about my 820s for Friday....
I don't trade in a tax-free account, so if my shares get called away, my tax bill will kill me and prevent me from buying the same number of shares back. I would be very nervous about anything below 800 for end of next week.

Some rationale on my side is that I'm actively looking to sell my remaining 2000 shares, so although I'll avoid exercise below $800, I won't cry if it happens

For the calendar spreads, I'll just keep rolling up and out, until they're in the same expiry as the LEAPS, but with way higher strikes - logical, no?

And while we're on the subject, STO 45x lcc750 @$5 - with the Hedgies capping at $740, have been chasing the price for hours...

 

[vikings123]

Some of you are MUCH braver than me with the 750 calls! I was nervous until recently about my 820s for Friday....
I don't trade in a tax-free account, so if my shares get called away, my tax bill will kill me and prevent me from buying the same number of shares back. I would be very nervous about anything below 800 for end of next week.

I used to be very careful with covered calls but realized that I was leaving a lot of money on the table. I really doubt we will see any major upswings for the stock until Wall Street believes in the FSD magic. Worst case you can always roll or take a loss. You will rarely have to do this though.

I started off very small but slowly started get more comfortable with the idea of selling calls with decent premiums while also having a good understanding of where the supply zones are(moving averages etc). I will never sell covered calls on red days.

 

[pz1975]

Why stop at 15k, when you can simulate
View attachment 712370

View attachment 712371

Looks like these are the same numbers (50% of share value).

Great thanks for doing that!

 

[bkp_duke]

I used to be very careful with covered calls but realized that I was leaving a lot of money on the table. I really doubt we will see any major upswings for the stock until Wall Street believes in the FSD magic. Worst case you can always roll or take a loss. You will rarely have to do this though.

I started off very small but slowly started get more comfortable with the idea of selling calls with decent premiums while also having a good understanding of where the supply zones are(moving averages etc). I will never sell covered calls on red days.

I'm not so sure FSD will be the rocket engine for TSLA that people think it will. I'm more inclined that around Q1 when Wall St sees the sales, net profit, and margin due to Texas and Berlin coming online that we could really see a rally from that "tangible" news.

 

[InTheShadows]

FYI LCID IV is high maybe there is a play there.

Yea I have been watching that stock for the last few days in complete and utter amazement.

 

[juanmedina]

Yea I have been watching that stock for the last few days in complete and utter amazement.

+36% on last 5 trading days. I had some warrants that were deep underwater I sold them today at a lost but I am trying to make the difference selling premium.

 

[buttershrimp]

the IVV (IV-Viewer) in IBKR tells a different picture:

SEP24 currently has its minimum of around 28 at ~770$ (currently: 33)
OCT15 has its IV-minimum of around 33 at ~825$ (currently: 39)
OCT29 has its IV-minimum of around 40 at ~850$ (currently: 46)

so if the SP rises *slowly* up to that by the given time, then IV will contract down to that number instead of going up - in addition to the contraction of IV by time.

If we dont climb gradually, but spikey, then IV will surely rise.

Edit: Picture for clarity
View attachment 712366

The mysterious smiling volatility skew! It lives!

 

[corduroy]

I'm not so sure FSD will be the rocket engine for TSLA that people think it will. I'm more inclined that around Q1 when Wall St sees the sales, net profit, and margin due to Texas and Berlin coming online that we could really see a rally from that "tangible" news.

Totally agree. No doubt, long term FSD will be huge. But short term I see the wide release of FSD beta as a possible negative catalyst. I think we have been very lucky to have 0 crashes on FSD, but when it gets into the hands of so many newbies, our luck may finally run out. If/when that happens the FUDsters are going to launch the mother of all campaigns. They probably have the stories already written, just ready to fill in the details.

This is something I think about when opening new put positions for next week and keeps me from getting too aggressive with my strikes.

 

[stealthyc]

Totally agree. No doubt, long term FSD will be huge. But short term I see the wide release of FSD beta as a possible negative catalyst. I think we have been very lucky to have 0 crashes on FSD, but when it gets into the hands of so many newbies, our luck may finally run out. If/when that happens the FUDsters are going to launch the mother of all campaigns. They probably have the stories already written, just ready to fill in the details.

This is something I think about when opening new put positions for next week and keeps me from getting too aggressive with my strikes.

It should not affect next week's puts FYI, once the button is released, there will be the 7 day driving monitoring before acceptance

 

[buttershrimp]

FSD release will be a big short term catalyst in my opinion followed by a concerted FUD effort.... but I think any press is good press as long as there are no school busses set ablaze shortly after.

 

[PastorDave]

I'm in 600s, 700s and some optimistic 800s. Very little stock. I also do something that's a bit different than what I've seen here that I wanted to share. I actually roll my deep ITM long calls week to week about 1-2 months out instead of buying year+ LEAPs. Once they're deep ITM it costs maybe $2 to roll to a new week:

11/19/21 600c = $156. 8 weeks to expiration, extrinsic value 18.81, $2.35 theta per week.
06/16/23 600c = $250. 90 weeks to expiration, extrinsic value 115.7, $1.29 theta per week.

So it's 10k less per contract, and I've got that money to either sell puts with or buy 50% more contracts if I want to sell more calls. Or it can just sit there and not be at risk, ready to be deployed on a dip. $1 more per contract per week seems like a pretty good deal to me for any of those benefits. The risk is that a short term dip near 600 will see my theta costs rise to more like $5 a contract per week, but at that point I can either wait it out for a couple of weeks or just bite the bullet and roll out a year (at which point the LEAPs should be a lot more attractively priced anyway).

Another advantage is that they have a higher delta: .83 in Nov vs .74 in June 23. So I benefit more from positive moves in the price of the stock. This suits my plan better as I'm expecting a huge run up at some point and will want to convert back to stock at that time.

I think the market is going to enter a euphoric phase sometime later this year now that we've finally had our pullback (not saying it's over, just that I doubt this is the "big one") and only after all of the sideline cash has piled in will we have the real correction that everyone's been waiting for. I've been thinking this for months now, but I finally found a youtuber who agrees with me, lol. This video is somewhat representative of how I expect things to play out:

My plan for the 700s and 800s is to sell at highs and rebuy at lows, but I've been bad at that so far . Long term, I'm hoping to get these deep in the money as well, but the stock has been stubborn about breaking out that high. Hopefully I'll get there on the 700s pretty soon.

 

[BornToFly]

I used to be very careful with covered calls but realized that I was leaving a lot of money on the table. I really doubt we will see any major upswings for the stock until Wall Street believes in the FSD magic. Worst case you can always roll or take a loss. You will rarely have to do this though.

I started off very small but slowly started get more comfortable with the idea of selling calls with decent premiums while also having a good understanding of where the supply zones are(moving averages etc). I will never sell covered calls on red days.

My biggest loses over the years have been from CCs when the SP jumped. How far out are you selling typically?

 

[CrunchyJello]

I'm in 600s, 700s and some optimistic 800s. Very little stock. I also do something that's a different than what I've seen here that I wanted to share. I actually roll my deep ITM long calls week to week about 1-2 months out instead of buying year+ LEAPs. Once they're deep ITM it costs maybe $2 to roll to a new week:

11/19/21 600c = $156. 8 weeks to expiration, extrinsic value 18.81, $2.35 theta per week.
06/16/23 600c = $250. 90 weeks to expiration, extrinsic value 115.7, $1.29 theta per week.

So it's 10k less per contract, and I've got that money to either sell puts with or buy 50% more contracts if I want to sell more calls. Or it can just sit there and not be at risk, ready to be deployed on a dip. $1 more per contract per week seems like a pretty good deal to me for any of those benefits. The risk is that a short term dip near 600 will see my theta costs rise to more like $5 a contract per week, but at that point I can either wait it out for a couple of weeks or just bite the bullet and roll out a year (at which point the LEAPs should be a lot more attractively priced anyway).

Another advantage is that they have a higher delta: .83 in Nov vs .74 in June 23. So I benefit more from positive moves in the price of the stock. This suits my plan better as I'm expecting a huge run up at some point and will want to convert back to stock at that time.

I think the market is going to enter a euphoric phase sometime later this year now that we've finally had our pullback (not saying it's over, just that I doubt this is the "big one") and only after all of the sideline cash has piled in will we have the real correction that everyone's been waiting for. I've been thinking this for months now, but I finally found a youtuber who agrees with me, lol. This video is somewhat representative of how I expect things to play out:

My plan for the 700s and 800s is to sell at highs and rebuy at lows, but I've been bad at that so far . Long term, I'm hoping to get these deep in the money as well, but the stock has been stubborn about breaking out that high. Hopefully I'll get there on the 700s pretty soon.

I look forward to viewing this video a little later;
Do you have any recommended videos to help newbies walk through your LEAPS strategy?