MindOverMatcha
Member
Spending my night crafting some BPS 11/12 strategies using margin. I was too nervous today to do one for next week. But I have a feeling that the FOMC tells the markets what they want to hear. Tomorrow at 7 AM PDT is the big moment.
Today I did a BPS 11/5 BPS at 1080/1040, 1000/970, 1010/985 which netted me a small 3k total. I wanted to dip my toes back in after two weeks off, mainly to train my mind. So this was more of a trial run for my nerves. I find that I need to set good boundaries when I trade, engage in good self-care like exercise, sit in the sauna for 20 minutes, and make sure my girlfriend doesn't get stressed from my stress. Lo and behold, I slacked on my self-care and she knew that I had dipped back into options trading without me telling her. Will aim to be more "professional" these next few days.
Using Options Profit Calculator for these calculations aftermarket (can change drastically tomorrow).
Writing this out made me realize that being 20% OTM still delivers pretty good premiums, more than I thought it would. I was unnecessarily riding closer to the edge, outside of my comfort zone.
Option #1
11/12/21, 50 contracts, -1,000/+970 (net premium is 2.60). 50 contracts times $260 = $13,000
Your risk of loss is $3,000 x 50 = $150,000, but your max gain is $13,000.
Probability of success: 93.8% (I don't give the options profit calculator much validity here in regards to TSLA but it helps a bit).
The risk is if TSLA drops down, and your puts become closer to ATM, making it very costly to bail yourself out.
Option #2
11/12/21, -900/850 (net premium $2), 30 contracts; $6,000
The benefit here is you are further OTM, you have a wider spread distance of 50 so that you can salvage the trade and the long leg doesn't sell your shares in a surprising gap down.
As I write this, I realize I may have been better off doing Option #2 today instead of my trade this week. It's further OTM and gives me more premium.
Probability of success; 99%
Option #3
11/12/21 -950/925, $155 x 60 contracts = $9,300
Mindset: Feeling confident that the price won't go down to 1,000 allows me to keep a thin spread, allowing for more contracts. Option 3 to me feels pretty good and mixed. Hard for me to believe we touch down past 1,000 next week, but even if that fear arises, I'll close this spread.
Success Probability: 97%
Depending on tomorrow, I may switch to this spread for next week and then close it out for a 50%-60% gain on Monday or Tuesday. Hard to tell now where we're headed, but it'll be easier to see come Wednesday and Thursday.
Today I did a BPS 11/5 BPS at 1080/1040, 1000/970, 1010/985 which netted me a small 3k total. I wanted to dip my toes back in after two weeks off, mainly to train my mind. So this was more of a trial run for my nerves. I find that I need to set good boundaries when I trade, engage in good self-care like exercise, sit in the sauna for 20 minutes, and make sure my girlfriend doesn't get stressed from my stress. Lo and behold, I slacked on my self-care and she knew that I had dipped back into options trading without me telling her. Will aim to be more "professional" these next few days.
Using Options Profit Calculator for these calculations aftermarket (can change drastically tomorrow).
Writing this out made me realize that being 20% OTM still delivers pretty good premiums, more than I thought it would. I was unnecessarily riding closer to the edge, outside of my comfort zone.
Option #1
11/12/21, 50 contracts, -1,000/+970 (net premium is 2.60). 50 contracts times $260 = $13,000
Your risk of loss is $3,000 x 50 = $150,000, but your max gain is $13,000.
Probability of success: 93.8% (I don't give the options profit calculator much validity here in regards to TSLA but it helps a bit).
The risk is if TSLA drops down, and your puts become closer to ATM, making it very costly to bail yourself out.
Option #2
11/12/21, -900/850 (net premium $2), 30 contracts; $6,000
The benefit here is you are further OTM, you have a wider spread distance of 50 so that you can salvage the trade and the long leg doesn't sell your shares in a surprising gap down.
As I write this, I realize I may have been better off doing Option #2 today instead of my trade this week. It's further OTM and gives me more premium.
Probability of success; 99%
Option #3
11/12/21 -950/925, $155 x 60 contracts = $9,300
Mindset: Feeling confident that the price won't go down to 1,000 allows me to keep a thin spread, allowing for more contracts. Option 3 to me feels pretty good and mixed. Hard for me to believe we touch down past 1,000 next week, but even if that fear arises, I'll close this spread.
Success Probability: 97%
Depending on tomorrow, I may switch to this spread for next week and then close it out for a 50%-60% gain on Monday or Tuesday. Hard to tell now where we're headed, but it'll be easier to see come Wednesday and Thursday.