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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
I think the market rallies for a bit from here.
At this point we have a double bottom on SPY around 411. Technical traders will be looking for next resistance point.
Signs that inflation is moderating will allow for substantial rally.
Wild card card is QT. They going to be dumping bonds hard for a while.
Barely.. sword of damokles still hanging above it .. if external factors send an invoice it means immediate bankruptcy. We currently prepare negotiations to make it out alive.
Jobless claims came in good this morning (just published a few minutes ago) so we should be good for continued rally today...
And I noticed a bit of bump in stocks after that happened...
Ugh, bad labor numbers just published and are reversing the market...
The 2nd column is actual, 3rd is median forecast, 4th is previous...
Ok, I swear that the options market doesn’t drive the SP. /s. Just another week of unpredictable action. I was really sweating yesterday, mad at myself for not buying back during the MMD, and taking those little profits. Today is an unexpected gift, so just bought back all my calls and a few shares. So now they will all expire worthless. MaxPain this AM says close below $990. I’m not sure whether to laugh or cry.
scubastevo80
Member
Rolled my 5/6 -860/+760 out to 5/13 -825/+725 for $5. I'll roll this down and out to the $700s if I have to and collect premium.
NOT-ADVICE
I consider the 780 strike to be safe. That being said it seems like my disasters frequently start by rolling my strike price, chasing after the shares to pick up a bit extra. Most of the time the rolls after the share price work well; occasionally the shares reverse aggressively and the chase after the share price goes badly for me. My personal rule as a result - don't do that (rolling OTM position closer to the money within the same expiration).
I closed my 1000 strike calls for this week opened yesterday. In at 2.40ish, out at .40.
With such a big move down today I'm selling a smaller portion of puts than I would otherwise, with the remainder of that backing cash holding for a buy opportunity. Open 750/500 put spreads for 5/13 at $6, with cash reserved in advance to buy shares / calls when (if) we see an $800 share price.
My expectation of an $800 share price in the month of May is unchanged. The rationale continues to be the same - little or no Tesla Story news to offset the Macro Story, leaving the Macro Story to dominate for the next few weeks.
Dang it, had a pretty juicy order in at market open for 0513-c$975 for a buy-write (at cost), but had the bad thought seeing the pre-market that we could have an MMD and I could do better about 11AM. Price is now 40% of the open. 
TheTalkingMule
Distributed Energy Enthusiast
5/13 BPS $690/590 @ $1.12
First sold BPS since the Janupocalypse. Instantly not enjoying this feeling. I'm gonna need to either become at ease with the idea of capital at risk, or get out entirely.
Will buy back tomorrow on the 8% rally
First sold BPS since the Janupocalypse. Instantly not enjoying this feeling. I'm gonna need to either become at ease with the idea of capital at risk, or get out entirely.
Will buy back tomorrow on the 8% rally
You must be writing a bunch of them. Hard for me to see the value in the effort of opening and closing a $1.12 position unless the volume is substantial.5/13 BPS $690/590 @ $1.12
First sold BPS since the Janupocalypse. Instantly not enjoying this feeling. I'm gonna need to either become at ease with the idea of capital at risk, or get out entirely.
Will buy back tomorrow on the 8% rally
closed all CC, BCS and everything else on that downturn.
Also rolled 5/13 950c to 5/13 900c and 5/27 1000c to 5/27 900c with the proceeds. Now we just have to go up in time ..
Not recommending this for anyone - i face bankruptcy & if i go bankrupt then i can do all or nothing anyway
Also rolled 5/13 950c to 5/13 900c and 5/27 1000c to 5/27 900c with the proceeds. Now we just have to go up in time ..
Not recommending this for anyone - i face bankruptcy & if i go bankrupt then i can do all or nothing anyway
i had the same ideaDang it, had a pretty juicy order in at market open for 0513-c$975 for a buy-write (at cost), but had the bad thought seeing the pre-market that we could have an MMD and I could do better about 11AM. Price is now 40% of the open.
and will close it soon
Something that has helped get me going again was to stop doing BPS for a couple of months, and instead sell cash secured puts. For me at least there was a huge difference in how I felt about those positions.5/13 BPS $690/590 @ $1.12
First sold BPS since the Janupocalypse. Instantly not enjoying this feeling. I'm gonna need to either become at ease with the idea of capital at risk, or get out entirely.
Will buy back tomorrow on the 8% rally
From there I've evolved recently into really wide spreads (which I've always used), with the position sized off of the # of csp I could sell. I will go as high as 2x BPS vs cash secured puts. So if I have $400k to back qty 5 800 strike puts, I will sell 10 of the 800/500 strike bps. This keeps my total cash at risk smaller, though max loss is more likely. Mostly it is a means to keeping my use of leverage under control, with a lot of good management choices available.
I also get increasingly conservative with my short put strikes as shares approach the top of the trading range / ATH. I want more cushion to protect against a large reversal. And I only open new short puts on a down day. This can mean staying out of the market for many days waiting for a desirable entry.
Using the 2x CSP metric means that the number of BPS I'm willing to sell with decrease as the share price goes up. That's ok with me. Keeping my leverage at 2x or lower has become really important to me
Ok, bottom is in. The MMs got below the $880 target, so stopped the pressure. I just wish I had more cash. Burned too much on the way down, but did pick up some shares at $884.20.
That didn't age well.
Didn't think it would be much of a rally but did expect some follow through to yesterday. Today is across the board liquidation as Bonds, stocks and cryptos are dumped. Raising cash by any means. Seems many are on board for a recession at this point. Think capitulation might be in the works.
The inflation numbers will rule the market for a while. That and rampant overshooting, speculation and manipulation.
Sounds like every other day except for the magnitude of the moves.
TheTalkingMule
Distributed Energy Enthusiast
Was just joking, God willing these will cruise to expiration worthless. I'll take my 1% and wait for the next opportunity.
The dynamic that I don't see priced into the market yet, much less Tesla, is the Fed beginning to reduce the balance sheet.
THey said $45B/month, for 3 months, to get things started. For the Fed to reduce its balance sheet by $45B, that requires the private sector to purchase that $45B. That $45B will come out of the universe of cash available to buy stuff in the stock market.
Three months at $45B is around $135B, with (I expect) almost all of that coming out of financial assets. Mostly the bond market initially, but it'll spread out to the rest of the market.
Then $90B per month for as long as needed. From other stuff I've read I expect the balance sheet to shrink down to $6T from $9T. That'll mean something like 30 months of $90B/month rolling off from the Fed balance sheet, and needing to be absorbed by the financial market.
As a poitn of comparison the Fed expanded the balance sheet from about $3T to $9T in the pandemic response, and as part of this massive growth in the stick market. A bunch of that is being pulled back. I don't know how big the impact will be on that withdrawal of cash / liquidity, but I'm confident it won't be small. As a reference point, the period in that big Fed balance sheet expansion corresponds, roughly, to TSLA growing from $90 to $900.
I also expect Tesla to be a relative winner in this process, as people become more choosy about what they use their cash on. Still Tesla down to 600 from 900 (down 33%) is outperformance when the market is down 50% (I made up the numbers to illustrate the idea).
THey said $45B/month, for 3 months, to get things started. For the Fed to reduce its balance sheet by $45B, that requires the private sector to purchase that $45B. That $45B will come out of the universe of cash available to buy stuff in the stock market.
Three months at $45B is around $135B, with (I expect) almost all of that coming out of financial assets. Mostly the bond market initially, but it'll spread out to the rest of the market.
Then $90B per month for as long as needed. From other stuff I've read I expect the balance sheet to shrink down to $6T from $9T. That'll mean something like 30 months of $90B/month rolling off from the Fed balance sheet, and needing to be absorbed by the financial market.
As a poitn of comparison the Fed expanded the balance sheet from about $3T to $9T in the pandemic response, and as part of this massive growth in the stick market. A bunch of that is being pulled back. I don't know how big the impact will be on that withdrawal of cash / liquidity, but I'm confident it won't be small. As a reference point, the period in that big Fed balance sheet expansion corresponds, roughly, to TSLA growing from $90 to $900.
I also expect Tesla to be a relative winner in this process, as people become more choosy about what they use their cash on. Still Tesla down to 600 from 900 (down 33%) is outperformance when the market is down 50% (I made up the numbers to illustrate the idea).
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