Bought these back at a loss of 0.90 per share at close today. Oops. Will look to sell as 1000s in the morning if I get a favorable price. If not, oh well - they were giving me heartburn.
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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Bought these back at a loss of 0.90 per share at close today. Oops. Will look to sell as 1000s in the morning if I get a favorable price. If not, oh well - they were giving me heartburn.
So, my psychic powers on Sunday nailed the 880 in premarket on Tuesday, and the reversal, but not as sharp as I thought.... so I'm amending my prediction to touch 815 and finish at 824.
Woah!
I thought you bought those as lottery tickets and almost followed your lead Friday. Was kicking myself a little when they were up 3x on Monday.
Obviously I forgot which thread I was in...
dc_h
Active Member
Wow, that is a big sell the news. Hard to see the sell off that big on a beat. I'd guess it will bounce after market, up 20 and down 40 and settling somewhere around down 20 and then bouncing back on Friday and rising next week. Thursday could be a great day to sell the BPS for 10-29.
I still believe this beat will be larger than expected. TBD.
Verily I say unto you, there will be a big beat…. It will be impressive. Monday and Tuesday next week will be glorious.
But the Oracle has spoken that blood stained candles will fall as hedge funds sell the news, defying the logic of the nobles on the main investment thread.
“824” cries the crow. “824”
Spppoooooky
So I was bothered by this question, since it made no sense to "reset" the holding period of the underlying shares just because we have to roll a DITM covered call. So I found this (which states that the holding period is suspended, not reset):
Whats the difference between a qualified and an unqualified covered call?
I own various shares that I want to start writing covered calls on but I've heard about differences between "qualified" and "unqualified" covered calls. What's the difference? All I can find is that
money.stackexchange.com
... and all that it concludes is that the capital gains on those shares would be treated as short-term only if they get exercised away by that "unqualified covered call".
BUT! There was a contrarian reply to that above answer (that talked about loss deferral rules) that referenced IRS Pub 550:
If you search that page for "qualified covered call", you'll find that the classification of qualified vs. unqualified is all within the scope of 'straddles' (look at the sidebar to see how the publication has things grouped), which is a position where you've bought both the put AND call option at the same strike price and expiration.
Prior to the straddle section, you'll find the Options section, where this applies:
"Options are generally subject to the rules described in this section. If the option is part of a straddle, the Loss Deferral Rules covered later under Straddles may also apply. For special rules that apply to nonequity options and dealer equity options, see Section 1256 Contracts Marked to Market , earlier.
Gain or loss from the sale or trade of an option to buy or sell property that is a capital asset in your hands, or would be if you acquired it, is capital gain or loss. If the property is not or would not be a capital asset, the gain or loss is ordinary gain or loss."
So, no, the holding period of the underlying shares do NOT reset, since it's not part of a STRADDLE. Not Advice though, since I'm not a tax accountant, but if you reference that part of Pub 550, then I think your CPA will agree.
OK, more thoughts on this... I'm planning to do 40x now, potential $160k profit by Friday if we close at the strike
Actually I'm covered on both sides of the trade: I have 40x c600's that I've been looking to sell and roll up, if the SP pops, these will increase in value too, likely cancel-out losses on the weekly trade, or near enough
For the downside, I still have 210x 650/735 BPS open, planning to close this out in early trading. Will leave 40x +p650 open to form a 210-wide spread with the ATM put short - will ring-fence the margin requirements
If the SP moves down, I can roll to next week, again as a spread, would be a good learning exercise
It's a win/win!
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InTheShadows
Active Member
Since IV hasn’t really risen that much are we still expecting an IV crush tomorrow morning? Maybe 50 to 47 or 45 at the most?
IV crush will happen in one direction tomorrow. Don't know which one....
I've dipped my toes into the BPS pool and seek guidance from any fellow Schwab Street Smart trader. I'm just checking if this looks like to proper way to roll a 740/690 BPS forward one week for the same strikes.
Is there a short cut to roll both legs of BPS? I rolled one leg and then manually entered the roll of the second leg. I imagine they need to be rolled at the same time to avoid margin madness.
Many Thanks!
Is there a short cut to roll both legs of BPS? I rolled one leg and then manually entered the roll of the second leg. I imagine they need to be rolled at the same time to avoid margin madness.
Many Thanks!
Knightshade
Well-Known Member
Whacky IRA idea predicated on sell the news happening-
Sell shares at $863ish, use cash to sell $850 10/22 puts at around $13.50-14/sh.... get back slightly higher # of shares plus the premium if it dips.
Could even hedge a huge climb by buying some $950 calls for 10/22 for like 10% of the premium received on selling the puts.
Dumb?
Sell shares at $863ish, use cash to sell $850 10/22 puts at around $13.50-14/sh.... get back slightly higher # of shares plus the premium if it dips.
Could even hedge a huge climb by buying some $950 calls for 10/22 for like 10% of the premium received on selling the puts.
Dumb?
jeewee3000
Active Member
Was planning on exiting my +700/-720 BPS (which are 90% profitable) and selling some BPS for next week but for the same strikes I receive abysmal premiums.
I think I'll wait 'till after earnings to close the position and open new ones. Unless my position goes to +95% profitable by the end of today or so.
I think I'll wait 'till after earnings to close the position and open new ones. Unless my position goes to +95% profitable by the end of today or so.
If you are going to buy some calls to hedge, maybe go out another week. The other option is just sell covered calls for 880 so if the SP drops you keep the premium and don't lose the shares. If it goes up and you lose the shares, sell Puts to get them back. I wish I had an IRA. Taxes in regular accounts prevents me from playing these profitable games.
IV is around 66% so quite high.. expecting a crush tomorrow. Looks like today will be fairly flat.. I will aim to close my bps tomorrow then.
bkp_duke
Well-Known Member
Can I ask where you are seeing 66%?
I'm seeing 4%
TSLA - Tesla Stock Price - Barchart.com
Tesla Inc stocks price quote with latest real-time prices, charts, financials, latest news, technical analysis and opinions.
www.barchart.com
Premiums for next week also are really low.
mickificki
Member
along the lines of this question, i see tsla at 49% IV on thinkorswim. but it appears each options strike has its own IV as well. Seems to be a big discrepancy on what the IV is, anyone know which is right?Can I ask where you are seeing 66%?
I'm seeing 4%
TSLA - Tesla Stock Price - Barchart.com
Tesla Inc stocks price quote with latest real-time prices, charts, financials, latest news, technical analysis and opinions.
Premiums for next week also are really low.
InTheShadows
Active Member
All of my 50% BPS orders triggered, now I’m ready for a monster MMD so I can open my earnings positions.
I’m not touching the call side of things. My short leg for everything will be 745. That’s almost 2 std deviations out with a delta of -.038 and behind a nice massive put wall at 750. I’ll likely go for around 70 point spreads except for the smaller accounts, those will get 1 contract as large as I can make it.
Edit: after further evaluation. I’m choosing the same strategy only for 10/29. Delta is -.08. And if I close at 50% after market open tomorrow I’ll make more than I would with this weeks going to expiry. Then I will have idea of direction and can re open next weeks positions with my standard formulas.
I’m not touching the call side of things. My short leg for everything will be 745. That’s almost 2 std deviations out with a delta of -.038 and behind a nice massive put wall at 750. I’ll likely go for around 70 point spreads except for the smaller accounts, those will get 1 contract as large as I can make it.
Edit: after further evaluation. I’m choosing the same strategy only for 10/29. Delta is -.08. And if I close at 50% after market open tomorrow I’ll make more than I would with this weeks going to expiry. Then I will have idea of direction and can re open next weeks positions with my standard formulas.
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When the last 5% percent becomes a few thousand of dollars it feels likes throwing away money specially with really safe strikes. I think my highest strike is $715 and yeah premiums for next week don't look that great, less than 50% that I got for this week.
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