I have 300 x 580/680 PS for next Friday. Thinking of adding some safer 570/620s for a little more play money. I've been at this long enough to know that <700 next Friday is unlikely, but NOT out of the question thanks to Macros....
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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Actually, I take that back. Looking at the BB, I don't see that we have ever gone from just below the top, to out the bottom in one week. 700 should be a safe bottom next week. Should...
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More likely the 14k of puts at $750.
Calls far above and puts far below max pain do not influence its value since they are OTM.
$725 kills the puts at $720 (55k oi) and $725 (9k oi) while reducing the $750 put value without paying out too much on the 700 calls (32k OI)
It's a big summation of all higher puts vs all lower calls. Big OI just increase the slope of payout per dollar of stock price.
The CCS portion at 1000/1050 is paying only 0.05 per option. I know it is a free bet, but is it worth the trouble going for it? I guess depending on how many options could be beer money.
I like to live dangerously, so I might tighten the spread to 1000/1010 to demonstrate my confidence that it will close under 1000 next Friday. I could lose hundreds (if not thousands) of cents if I’m wrong. wish me luck gentleman
End of August 2020 the BB were more than 30% apart, and SP dropped about 30% in one week without coming out the bottom. Now the BB are less than 10% apart. Hopefully that keeps us safe (if using 700 as a Put play next week).
MTBEndodontist
Member
MTBEndodontist
Member
'The Wheel' Thread Glossary:
IC: Iron Condor
BPS: Bull Put Spread
BCS: Bear Call Spread
CC: Covered Call
LCC: a LEAP Covered Call
LEAP: A long dated option, typically 12 months+
C+/C-: Bought/Sold Call Option
P+/P-: Bought/Sold Put Option
STO: Sold to Open
BTC: Buy to Close
BB: Bollinger Bands
SP: Share Price (TSLA)
$TSLA: Value of a Tesla stock holding
IV: Implied Volatility of an Option
OTM: An option that is Out of the Money (eg a Call above current SP)
ITM: An option that is In the Money (eg a Call below current SP)
CTM: Close to the Money (eg very near the current SP)
DITM/DOTM: Deep In or Out of the Money
OI: Open Interest (number of contracts at a strike on the options chain)
Call/Put Wall: A significant high point on the OI graph (Stock Option Max Pain)
The Wheel: An Options strategy where if a call is exercised you sell an aggressive Put that may get exercised or vice versa.
ShitCall/ShitPut: Well OTM lower value CC or Put
I Dare You Calls/Puts: Very CTM Calls or Puts, often near a strong Call/Put Wall
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You forgot shitputs/shitcalls - please amend
jeewee3000
Active Member
And the opposite of these: "I dare you calls/puts"
And while you're at it add "$TSLA" for the heck of it
But seriously, good post for newcomers. We can link to it every now and then.
jeewee3000
Active Member
800cc OI dropped slightly to 22.283 today.
I got out of my 800cc's at break-even yesterday with an automatic (edit:
I'd rather enjoy a friday surge instead of fretting about it.
GLTA. Next week should be great.
I'm loading up on LEAPs in retirement account. Went with 10x $750 Jan 2024 to start off the day.
Will be looking to load up more if anyone has some non-advice on when might be a good time.
Will be looking to load up more if anyone has some non-advice on when might be a good time.
llirk
Member
Before Jan 2024I'm loading up on LEAPs in retirement account. Went with 10x $750 Jan 2024 to start off the day.
Will be looking to load up more if anyone has some non-advice on when might be a good time.
Very happy with my Jun 2023 purchase when my dare you calls were exercised earlier this month.
Looking for some advice here from everyone.
I get that some people are using the wheel to act as an income replacement. I am not in that stage yet -- I am still in the growth stage of things (long term goal of TSLA to 2-2.5k, maybe 5 years?). With the weekly premiums that I am accumulating, I want to reinvest that back into TSLA because I think there are 2-3 more legs up before we level off for a while. I also really am reticent to touch any of the shares I have and lose them, so I am playing pretty conservative and not selling CC and focusing exclusively on selling puts right now. This is also a taxable account. What is the best approach to grow from your perspective?
Buy DOTM LEAPS (Jan 24 1500 calls)?
Buy DITM LEAPS (Jan24 600 calls)?
Buy shares?
Another question, if I buy a DITM calls and then sell CC off of that and get assigned, is there a way for me to choose which shares get taken away? Or does the broker have sole control over that?
Thanks in advance!
I get that some people are using the wheel to act as an income replacement. I am not in that stage yet -- I am still in the growth stage of things (long term goal of TSLA to 2-2.5k, maybe 5 years?). With the weekly premiums that I am accumulating, I want to reinvest that back into TSLA because I think there are 2-3 more legs up before we level off for a while. I also really am reticent to touch any of the shares I have and lose them, so I am playing pretty conservative and not selling CC and focusing exclusively on selling puts right now. This is also a taxable account. What is the best approach to grow from your perspective?
Buy DOTM LEAPS (Jan 24 1500 calls)?
Buy DITM LEAPS (Jan24 600 calls)?
Buy shares?
Another question, if I buy a DITM calls and then sell CC off of that and get assigned, is there a way for me to choose which shares get taken away? Or does the broker have sole control over that?
Thanks in advance!
Knightshade
Well-Known Member
You have SOME control. How much depends on the broker.
Some you can actually select this online, swapping share lots as long as it's not settled yet.
For me I have to call my broker to assign specific shares to an assignment, which is annoying and another thing that makes me happy switching to BPS.
Go back about 3 months and read and take notes on @Lycanthrope and @adiggs posts in this thread.I'm loading up on LEAPs in retirement account. Went with 10x $750 Jan 2024 to start off the day.
Will be looking to load up more if anyone has some non-advice on when might be a good time.
It depends on your broker and account setup. I did some careful analysis about a month ago comparing various strategies. I HODL my shares and sell spreads (IC, BPS, BCS) against the excess margin liquidity backing in the account. This gives me the maximum premium return against allocated margin. And the excess margin accumulates most by keeping premiums in the account as cash. So for me the best approach has been to accumulate cash to maximise the account liquidity to then sell even more contracts to generate more cash. At some point (very soon) I top out the number of contracts I'm prepared to sell and then use the generated cash to accumulate by buying LEAP spreads and shares.
Welp, rolled all put spreads and closed my couple remaining c815s this morning. I have definitely met my income goals for the week.
On the put side, next week I'm trying a $100 spread for closer to the money and $50 spread for further away (equal numbers of each). Assuming the quarterly numbers are OK I think there's very little risk to either, but I feel better with the larger spread where I'm more likely to need to act, and I like the better premiums from more contracts of the smaller spread in the safer-but-less-profitable territory.
On the put side, next week I'm trying a $100 spread for closer to the money and $50 spread for further away (equal numbers of each). Assuming the quarterly numbers are OK I think there's very little risk to either, but I feel better with the larger spread where I'm more likely to need to act, and I like the better premiums from more contracts of the smaller spread in the safer-but-less-profitable territory.
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