But remember that I have to close $12M of short legs also. I do like the plan of going fewer contracts with wider spreads for Jan 2024.
Closing the long legs for this week gives me about 750k back as well, but that is peanuts compared to my loss.
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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Closing the long legs for this week gives me about 750k back as well, but that is peanuts compared to my loss.
That's a lot of lifting to do , so many of us in similar at our risk bearing scale ! If you need a spirit / fundamental lift, I certainly do. Get a listen to the earnings preview with Ives ... broad coverage, love this weeks pick... Dan, he's the man !
Here is another rescue. Close the 900X ITM short legs. Open just 250X Jan 2024 1000/1500. When I add in the money from the long legs (750k), the debit is $2m (so I drop cash on hand from $8.1M to $6M). But I keep plenty of margin available to still do weeklies the next two years and hopefully make more money in the end.
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I’m sorry to see a lot of people are in trouble. I hope that in a few weeks time you can all say: ‘thanks for the turnaround that saved me’.
Seems like a lot of the forum is approaching peak fear or close to it. Be careful not to do anything irrational as a result.
With the Macro I'm expecting we could still drop further on Monday but am looking to Tuesday and Wednesday to get a truer reading. Microsoft reports earnings on Tuesday and is expected to be strong, so that could reverse much of the impact of Netflix. There's a lot of market uncertainty with exactly what the Fed will do, so there could be a bit of a relief rally after Powell speaks following the meeting. Then there's Tesla's earnings and call where I see the biggest risk to a rally being what Elon might say (production is hard...).
Whatever happens, I'll be looking to roll a lot of positions out a week by Wednesday. I've been DITM on numerous positions since Elon started selling (biggest is now 175 x 990/1090 BPS) and have gotten used to rolling forward over time. I roll weekly for credit whenever I can but will roll for debit when I have to. When rolling for debit I try to have enough reserve margin to generate 'safer' premiums to at least cover the roll cost and maintain capital. While that's the goal, a few mistakes along the way have seen me lose some capital, but I'm hanging in there and moving forward because I know TSLA will power forward at some point.
With the Macro I'm expecting we could still drop further on Monday but am looking to Tuesday and Wednesday to get a truer reading. Microsoft reports earnings on Tuesday and is expected to be strong, so that could reverse much of the impact of Netflix. There's a lot of market uncertainty with exactly what the Fed will do, so there could be a bit of a relief rally after Powell speaks following the meeting. Then there's Tesla's earnings and call where I see the biggest risk to a rally being what Elon might say (production is hard...).
Whatever happens, I'll be looking to roll a lot of positions out a week by Wednesday. I've been DITM on numerous positions since Elon started selling (biggest is now 175 x 990/1090 BPS) and have gotten used to rolling forward over time. I roll weekly for credit whenever I can but will roll for debit when I have to. When rolling for debit I try to have enough reserve margin to generate 'safer' premiums to at least cover the roll cost and maintain capital. While that's the goal, a few mistakes along the way have seen me lose some capital, but I'm hanging in there and moving forward because I know TSLA will power forward at some point.
TheTalkingMule
Distributed Energy Enthusiast
My worries are on a much lower scale than you Jay-Z level traders here, but I'm as extended as I've been in my early days. Sitting on similar aggressive, but I assumed entirely reasonable, BPS to everyone else.
Probably should've rolled my 1060/960 1/28 BPS when I had the chance. I'm going to leave a roll order up at a moderate debit and see if it executes on any rebound Mon-Wed. Willing to pay a bit to ease this stress.
Other than that, I'm inclined to call their bluff and wait on earnings we know to be insane. I think MM's would be absolutely overjoyed to keep SP below $1100 Friday and not pay out those calls next week. Relative to the reality we assumed just weeks ago of $1200 being a decent possibility.
Probably should've rolled my 1060/960 1/28 BPS when I had the chance. I'm going to leave a roll order up at a moderate debit and see if it executes on any rebound Mon-Wed. Willing to pay a bit to ease this stress.
Other than that, I'm inclined to call their bluff and wait on earnings we know to be insane. I think MM's would be absolutely overjoyed to keep SP below $1100 Friday and not pay out those calls next week. Relative to the reality we assumed just weeks ago of $1200 being a decent possibility.
thank you for asking... i may be wrong (again) but i think 1/28 -p900/+p800 will expire
i feel so bad hearing about the losses and my heart goes out to those affected, for real and it hurts
i am sincerely very bad in giving advice; all i can say is
- i think that a market reversal is coming soon in weeks or a few months; this isn't a persistent recession thing where millions are losing jobs or millions are still dying or the world ran out of oil or there is a major terrorist attack, etc
- last Dec, i had a bad feeling about Jan 2022 and i probably mentioned it 2 or 3 times; going forward, i think we'll get crashes again and it will be more often (aka evergrande, hertz, feds, never-ending virus, rumors of war, more elon selling, nonstop sudden tech in/out rotations, etc)
- hold on tight and don't lose hope; i've also had losses before many times and i survived; imagine a reckless newbie being down $1.7M at one point due to gambling; after my account recovered, i vowed to never let it happen again and that explains the label sticker on my monitor - it reminds me again and again that i am dealing with real dollars: THE HOUSE ALWAYS WINS so i need to be the casino that writes the rules, not be the player that rolls the dice and hopes for a win. If i win, it's not because of me or luck, it's because of the strategy.
trying to be a bit rational here:
1) the market has factored in and fully priced in the worst possible announcement Powell could make on Wednesday.
2) Wallstreet underestimated significantly Tesla deliveries 275k vs 306k and the stock jumped +12% the day after. They will have also have underestimated margins and EPS.
If Powell announces a delay in rates hikes to avoid stock market collapse and Tesla announces earnings out of this world, we will get a recovery this week, in cas rolling to 2-4 weeks is the way. If we don’t have that combination, we will be visiting the 800s and I recommend rolling as far as possible.
I am optimistic in nature and think Wednesday will be a turning point. However, I am wrong 50% of the time, unfortunately.
Good luck surviving everyone. Like my wife told me yesterday: “It’s only numbers on a screen, you never going to see that money anyway.”
How brutal.
1) the market has factored in and fully priced in the worst possible announcement Powell could make on Wednesday.
2) Wallstreet underestimated significantly Tesla deliveries 275k vs 306k and the stock jumped +12% the day after. They will have also have underestimated margins and EPS.
If Powell announces a delay in rates hikes to avoid stock market collapse and Tesla announces earnings out of this world, we will get a recovery this week, in cas rolling to 2-4 weeks is the way. If we don’t have that combination, we will be visiting the 800s and I recommend rolling as far as possible.
I am optimistic in nature and think Wednesday will be a turning point. However, I am wrong 50% of the time, unfortunately.
Good luck surviving everyone. Like my wife told me yesterday: “It’s only numbers on a screen, you never going to see that money anyway.”
How brutal.
All I can say is I'm in awe of your approach @Yoona . Your risk management style is where I hope to end up. Can I sign up to be the intern to the newbie trader?
I don’t have anything else to add but want to wish you good luck. Hope it turns around.
Question on a related note about taxes: How does offsetting of short term losses work against long term capital gains. For example if one has 200K in short term losses from options trading and 300K in long term capital gains from selling stocks/LEAPS would you pay taxes on 100K long term capital gains? I’m assuming it’s not that simplistic but might influence how I handle next week’s BPS lol.
I'm glad I went through this thread again. I can sell just enough Jan 2024 1000/1500 to roll down my Jan 28 BPS, not necessarily close them all out. Need to run more numbers now....
Knightshade
Well-Known Member
AFAIK losses must be used first to offset gains of the same type. But if your losses of one type exceed your gains of the same type, then you can apply the excess to the other type.
Mind you, it's not the most efficient use of a short term loss to offset a long term gain given the difference in tax rates.... (IIRC you can also use ST losses to offset up to 3k/yr in normal income if you've such losses left over)
Mind you, it's not the most efficient use of a short term loss to offset a long term gain given the difference in tax rates.... (IIRC you can also use ST losses to offset up to 3k/yr in normal income if you've such losses left over)
Interesting. Doesn't seem worth it. Over 6 Million just to take a few off the table and roll down to 900/650 for end of Feb, which might not be safe.I'm glad I went through this thread again. I can sell just enough Jan 2024 1000/1500 to roll down my Jan 28 BPS, not necessarily close them all out. Need to run more numbers now....
I calculated that I would need to open 310 Jan 2024 -1500/+1000 to completely close out all my positions. Then I still have enough margin to do 350 weeklies spreads for the next two years, picking strikes I actually like.
Verify with your cpa, but basically yes. At the end of the year you offset short term gains and losses, and separately offset all long term gains and losses. Any remaining losses can then offset any type of gains. Here's a related link from intuit TurboTax link regarding tax losses and gains
Apparently towards the close traders sold a lot of puts. Since stocks/indices did not recover the implication seems to be that market makers did not hedge which sets us up for an even more interesting week.
Interestingly enough the 30X Feb 04 calls I bought retained their value really well in spite of the drop in SP, bought them when SP was around 960 and I’m still pretty much even on that position.
This data + any potential mischief by hedge funds last week limits the downside imo. Will there be another bear raid Monday morning? I think we should expect that but if your account has available margin/cash and you can stomach the paper losses I suggest a wait and see approach. Definitely go into Monday with a clear game plan and do what is best for your situation.
Try running the numbers with a Jan 2024 spread with a higher and tighter spread. Instead of 1000/1500 run the numbers with 1300/1500. The 1300/1500 will result in more contracts but for the same premium amount you should require less margin
I don't like the higher risk of the higher strikes....
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