Wiki Selling TSLA Options - Be the House

[Max Plaid]

oh, i like this... and it passes my "will i lose capital?" smell test

there's also 3 ways to fix it in case one side is DITM: roll / adjust a leg / buy a long leg (as hedge)

Short Straddle Option Strategy Guide & Example

A short straddle option incorporates selling a call option & a put option with matching strike price & expiration.

optionalpha.com

What I also find interesting is that although you've got $73k at risk on the puts and $73k at risk on the calls, you don't have $146k at risk as only one side will win (assuming you leave to expiry), and then this is giving a 15% return

In order to run this, I need some shares, so I will make my put sells a bit more aggressive in the coming weeks (10x -p700's in play this week - they might exercise, who knows...?), I'll start with 10x, then if the puts exercise after the first iteration I'll run it 20x - in principle that's $250k per month if the SP were to close at the strike... that's bonkers

 

[juanmedina]

Hello you lot...

I'm thinking about straddles again... yes, I know... my current idea is an ATM 4 weeks out, so right now -p735/-c735

Such a trade would net $12k, meaning break-even if the SP is approx >610 <850 by end July

My motivation for considering this is that I have absolutely no idea where the stock market is heading, everything is being pushed around by the indexes, individual stocks are getting lost in the noise

The worst-case outcomes is a purchase of some shares with a net price in the low 600's or the selling with a net around 850 - is that such a bad thing right now??

First I need too acquire some shares though

I entered this trade. I need money for a vacation .

 

[corduroy]

I'm still trying to wrap my head around straddles, as opposed strangles and iron condors, which all have similar payout diagrams and strategies.

For example, you can create 7/29 IC 5x -850/750-610/5010 with a slight wider break even range for $13k credit and $36k at risk. Even though these have a lower and defined risk, we all know the headaches that BPS and BCS can cause.

Strangles seem more conservative, but much less credits.

I need to do a deep dive comparison on all 3, but straddles do sound intriguing!

 

[UltradoomY]

Looking to do some more round and round trading on the call side this week -
Opened some $775's (Calls) STO $10 a bit ago
Will close at $5 or lower and look to reopen.
Seems like we can't get off the launch pad this week - so might as well try and run a profit.
Definitely will be out of weeklies by Friday.

Still have my obtuse BPS from last week - 8/19 BPS $700/$900 and Bought $700's that are up 15% so far - might close this out by Friday - will go with the super technical analysis of "gut feeling" on these.....

 

[Yoona]

I'm still trying to wrap my head around straddles, as opposed strangles and iron condors, which all have similar payout diagrams and strategies.

For example, you can create 7/29 IC 5x -850/750-610/5010 with a slight wider break even range for $13k credit and $36k at risk. Even though these have a lower and defined risk, we all know the headaches that BPS and BCS can cause.

Strangles seem more conservative, but much less credits.

I need to do a deep dive comparison on all 3, but straddles do sound intriguing!

for IC/strangle, initial credit is all yours

for straddle, you will need a bullseye to get all of the initial credit

 

[Yoona]

Looking to do some more round and round trading on the call side this week -
Opened some $775's (Calls) STO $10 a bit ago
Will close at $5 or lower and look to reopen.
Seems like we can't get off the launch pad this week - so might as well try and run a profit.

me also, this week is heaven for daytraders... 49% in 30 mins; closing it now

 

[elasalle]

Shares have been naked for a while - no CC's against. Have closed all CC's and just doing minor/small weekly CC's for a while.

Not sure how to position for this weekend binary event - I am thinking by Fri I need to sell some Dec22/Jan 23 CC's and get me some protection. If I go this route, thinking of doing against all shares and for 2000+ strikes. At a min, I think I need some protection for my personal account.

need SP to rise till Fri ...
+ need to also consider 1:3 stock split for this

 

[Max Plaid]

Shares have been naked for a while - no CC's against. Have closed all CC's and just doing minor/small weekly CC's for a while.

Not sure how to position for this weekend binary event - I am thinking by Fri I need to sell some Dec22/Jan 23 CC's and get me some protection. If I go this route, thinking of doing against all shares and for 2000+ strikes. At a min, I think I need some protection for my personal account.

need SP to rise till Fri ...
+ need to also consider 1:3 stock split for this

GOOGL has a 20:1 stock split on 15th July and the stock is going down the drain... I'm scratching my head as to why this is the case... I can only think it's Hedgies manipulating to scare retail out of anything they might have bought for such a run-up...

Very weird and yes, disappointing...

 

[juanmedina]

GOOGL has a 20:1 stock split on 15th July and the stock is going down the drain... I'm scratching my head as to why this is the case... I can only think it's Hedgies manipulating to scare retail out of anything they might have bought for such a run-up...

Very weird and yes, disappointing...

At least no one has bought the Tesla stock split yet.... as far as I can tell.

 

[TheTalkingMule]

me also, this week is heaven for daytraders... 49% in 30 mins; closing it now

View attachment 822139

I'm sitting here complaining there's no interesting BPS premium this week and I don't wanna get steamrolled on CCs. Meanwhile, you're making 50%. Lol!

Not gonna venture into this world yet, but thanks for the view!

 

[ReddyLeaf]

Bought back 755CCs, hoping to resell after a bounce, and the SP fell $15 off a cliff. Once again, my timing is impeccable. That’s it, I’m out for the week until I have to roll -p715s to next week. Crazy, MaxPain this AM was $720 with small walls at p700 & c750. They tested the call wall and now they are pushing for the put wall, just like clockwork. Why is it so obvious in retrospect, but I can’t seem to trade it? Well, at least I’m picking up a few shares (again, probably early, so the SP will dive more).

Edit: ok, more buys set at $694.20, $689.69, and $704.20.

 

[Drezil]

Bought back 755CCs, hoping to resell after a bounce, and the SP fell $15 off a cliff. Once again, my timing is impeccable. That’s it, I’m out for the week until I have to roll -p715s to next week. Crazy, MaxPain this AM was $720 with small walls at p700 & c750. They tested the call wall and now they are pushing for the put wall, just like clockwork. Why is it so obvious in retrospect, but I can’t seem to trade it? Well, at least I’m picking up a few shares (again, probably early, so the SP will dive more).

tell me about it ...
had 5x 720p as security against a hard downtrend..
they were under water by 40% earlier .. so i reduced it on the welcome gap down to 2x 720p at break even... had i hold onto all 5 until now i could have pocketed so much gains on the 3 i sold to push the cost-basis of the rest below 0 and then could chill until friday knowing i would be secured from black-swan-events...

on the other hand: on the trend up i managed to free my 700/730/745 ratio butterfly to a 715/730/745 butterfly with a guaranteed profit of ~$300 and teoretical max-profit of ~$1500 (freeing a position: turning the trade info a "always win" trade through management)

 

[TheTalkingMule]

As we dip lower, seems decent premiums become available for those looking to throw good money after bad.

Just widened and rolled my few highest strike lingering BPS from 8/19 $1050/$850 to 9/16 $1050/$820.

Additional cash margin in IRA: $3k per contract
Net credit on roll: $13.35

Not bad if you're a long term megabull like me. I got nearly half my additional margin back in cash and bought myself another month to avoid early assignment. As July earnings approaches, now all I need is SP to hit $935 rather than $950 in order to roll for credit if needed.

I'll be riding these BPS to Valhalla if necessary. Cheers to the longs!

 

[JustMe]

Hello you lot...

I'm thinking about straddles again... yes, I know... my current idea is an ATM 4 weeks out, so right now -p735/-c735

Such a trade would net $12k, meaning break-even if the SP is approx >610 <850 by end July

My motivation for considering this is that I have absolutely no idea where the stock market is heading, everything is being pushed around by the indexes, individual stocks are getting lost in the noise

The worst-case outcomes is a purchase of some shares with a net price in the low 600's or the selling with a net around 850 - is that such a bad thing right now??

First I need too acquire some shares though

I was just thinking of this exact same trade.

Great minds think alike.

 

[JustMe]

GOOGL has a 20:1 stock split on 15th July and the stock is going down the drain... I'm scratching my head as to why this is the case... I can only think it's Hedgies manipulating to scare retail out of anything they might have bought for such a run-up...

Very weird and yes, disappointing...

You should obviously stick with TSLA. That sort of irrational price action never happens

 

[Max Plaid]

You should obviously stick with TSLA. That sort of irrational price action never happens

I'm definitely looking to de-diworsify... has been an interesting experience with other stocks, but too much to track, for which I don't have the time nor bandwidth

Plus the roic on $TSLA options is much higher than the others, AAPL is the worst... looks like the -c140's I sold last week might expire, so will need to resell those - make hay while the sun shines, eh?

Feeling inspired by the juicy premiums for next week, I did put a limit sell for 5x -c800 @$15.1 when we were popping, missed it by 50c, which sucks

 

[adiggs]

Shares in the 703ish range, I am opening two new positions.

In one account I've purchased shares at 703ish and sold the 690 strike call for this Friday collect $27. I'll get a max gain of $14 on every share price above 690.


More interesting is that I consider this price to be particularly low (open on a down day!), I still hold a strong feeling that we're more up than down this week, and that I expect a pop on Monday after the production report.

At the very least I see this share price as being low enough that if I'm wrong about the trading range this week, I am unlevered and can own these shares for an extended period should I need. Therefore in this second position I am legging into the buy-write.


That makes these positions more like traditional share purchase / cc sales, but my mentality with these is still buy-write / income focused. At this moment I anticipate 1 of 2 paths - I'll take the traditional route and sell covering calls tomorrow on a rebound. The other path is that I wait until next week to either sell calls at that point, or even just sell the shares if we're up enough.

As an order of magnitude I consider a $40 increase in the share price from here to be readily available - we've seen that 745ish share price today. A $40 increase would represent a full month of desired income in a single week, suggesting that just selling the shares and looking for a new entry is a good choice -- no selling of options at all!

If the shares are down over the week then it'll be more interesting. The management will look just like selling cc's when the share price is lower than the share purchase price.

 

[bkp_duke]

Haven't been making many weekly trades, but settled on a long-term play with today's drop.

Bought some $900 6/24 LEAPS in prep to ride the TSLA train upward over the next 24 months.

 

[Yoona]

all 7/1 CCs closed; 83% in 5 hrs

(i know, i know, why did you do that, it was not necessary)

 

[UltradoomY]

all 7/1 CCs closed; 83% in 5 hrs

(i know, i know, why did you do that, it was not necessary)

Closed mine at 70% because of "round numbers" in for $10 --> out for $3 on the $775 calls......

Should have sold more..... Should have waited for a better close.... lol... I don't mind being cautious and definitely don't mind missing the extra.
Cheers!