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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
How about lowering the Strike price to $1000 for the Dec CCs? They are worth almost 50% more.
I’d much rather have CCs six months out than two years out. Easier to roll etc.
TheTalkingMule
Distributed Energy Enthusiast
That's just the thing, it isn't traumatic cause it's only institutional and hedgie holdings. Who in their right retail mind had a significant position in Snap yesterday?
Now tomorrow......that might be another story. We all like a bargain, but this one is hard to justify.
Yep, they opened a can of whoop $#^ and it spread through social media, ad sellers/service providers - FB, GOOG, TTD, APPS, IPG, PUBM, WPP, ... Some of those companies have incredible growth but expectations drop when there's fear of an economic downturn.
Make sure you don't get margin called if the stock price goes down another 50% or so.
If that is not an issue then I cannot convince you.
If we breach 600, I will exactly do this. Thanks, good tip and I agree 6 months out is better than 2 years.
How about a nice big 6mo rebound? I would take $700+ for Friday, $740 would be even better.Any more bright ideas!?!??!?!?
For perspective, if Nasdaq drops 10% more, TSLA can drop 20%:
We could have a bear market rally though for now and then come back down.
TSLA fundamentalists no longer working, it’s a hostage of a bear market.
We either have a panic and capitulation or a prolonged pain, prob another 3-6 months at least. Inflation not going down, war can easily last till EOY - there will be no capitulation from Putin, for him it’s now about extending the duration of his ruling at any costs (of somebody else’s lives), given that the outcome is pretty much known. And Ukraine will 100% not agree to any peace deals at the cost of losing its territory, I know cause I follow the subject. So, the war will not resolve quickly. It will be a slow grind for Ukraine to recover all occupied territories.
The expensive energy is part of cost of all goods and inflation. Plus food prices crisis he’s intentionally creating. (and later, more refugees to Europe from poor countries)
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If you have no current margin obligations, bottom is definitely the best time to sell leap puts(and maybe buy leap calls with the money).
I would suggest though not to put 100% into this at one time, but cost average in case we go down to 500 or less.
You may get better prices. Also, plan on having your margin drop more in the worst case.
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I'm calling the bottom right here.
Yes, that's right. 4 resistance trendlines (2021 one hasn't acted as a resistance, though) with the same slope. I can't see us dipping back into the previous channel with everything going right for the company.
Yes, that's right. 4 resistance trendlines (2021 one hasn't acted as a resistance, though) with the same slope. I can't see us dipping back into the previous channel with everything going right for the company.
What bugs me about some posters, more so on reddit than here. Is that they are still missing the important fact that we are indeed a hostage to the market. There could be extra weakness on TSLA due to margin calls and higher interest in puts but at the end of the day it's the market and the sentiment that's killing this stock.
People are reading into technicals but also annoyingly enough people also are claiming that the illuminati or some other group of people are shorting TSLA down so Elon cannot buy Twitter and get political on everyone. Or that MM's are trying to buy our precious TSLA shares at a discount so they are crashing TSLA to trick us into selling. Then you go over to NVDA who is also down more than 50% from ATH and they are like o yer that stocks just down cause it sucks. Lol ok.
For this to happen, traders have to be trading and buying on technical analysis and for one stop behaving like a crowd being ran over by bears. Bought protective puts in the 370 for margin management so I could survive another 10% drop but this thing needs to reverse before it gets to zero.
I have DITM 6/17 -840/+690 BPS that I have to act on before they get worse than they already are. Checking the option calc, I can roll these up and out to December -960/+810 for a debit of -763 per contract ... not good. To close using yesterdays option pricing, it'd be -12,890 each contract ... worse. The ongoing weight of the spread from a margin perspective is my concern, as is giving back incremental gains in one swoop. Rolling to December isn't optimal given I have other spreads I had to roll there with short ends at 1150 and 900. Setting aside this weeks expiry are ITM pre-market, managing the Jun spread now will clear the way through September from an underwater spread perspective.
Any non-advice regarding the two choices or alternatives to consider?
Any non-advice regarding the two choices or alternatives to consider?
jeewee3000
Active Member
You could split the $150 wide spreads up into 3x $50 wide spreads.
For example 1x 6/17 -840/+690 BPS could be converted to 3x JAN2023 -820/+770 BPS at a slight credit. (EDIT: my optionscalculator now tells me this is at a debit, apologies. You might need to increase strikes for a credit to around -920/+870).
$820 seems very reasonable by year end IMO. If you want more credit you could go for -850/+800 or higher but then you're not de-risking.
You could roll to a sooner date but personally I would advise against that. Every roll when ITM costs money. It's better to roll farther out IMO and - should the SP reverse unexpectedly and we see ATH this summer - roll to a closer expiration at higher strike when the opportunity presents itself.
If -820 by JAN2023 seems too unsafe you could roll out even further at the same strikes and this would make it even more safe. Again, you can always roll back (one by one) should the SP reverse.
Stay safe.
TheTalkingMule
Distributed Energy Enthusiast
I had 6/17 BPS $1000/800 that I rolled to 8/19 $1020/780(widening $40) yesterday. I think the credit was something like $14. If we're still <$900 after 2Q, I'll likely do the same thing again and punt to Nov18 expiration (after 3Q).
My policy is to roll out as far as I can without actually giving up a debit. Ideally pushing as far out as possible and lowering strike if possible. Best situation is no debit/credit, but widening for strike improvement.
In this instance I didn't see any good rolls like that, so I took the credit and now have slightly more cash margin on the position in my IRA.
The basis of my system is that nothing will stop Tesla, so I'm willing to add cash margin to buy time.
I had a $910 put I sold for next week exercised this morning.
jeewee3000
Active Member
Forgot to post these last night. Monday to Tuesday, put interest increase at 600 and 650, shifting away from 700 strike. Some lessening overall of call interest at 700 and 750. Keep in mind these will not align with the put/call wall charts. The values are calculated by multiplying the gamma (negative for puts) at the strike by open interest.
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closed my 5/27 -p570/+p470 at the peak, +73% in 2 hrs
waiting for dip to retry
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