Wiki Selling TSLA Options - Be the House

[BornToFly]

Aside from wanting to perhaps own the shares, why not a CSP for the same premium with a chance to buy at 850? Trying to understand the benefit to the buy-write with the anticipation that we may go down some this week.

I used to wonder the exact same thing.

If we close at 845, I made $65 instead of $5 (not taking into account the paper loss on the shares). Also less margin required if using margin (don't ask me why).

Edit: If we are at 870 on Friday, the "profit" on the buy/write is $45 (can close or roll).
Edit2: The Buy/Write gives you more opportunities for more income with a roll at various strikes.

 

[BornToFly]

Man, I am loaded to the gills on 1100 and 1150 sold calls. I haven't "made this much free money" in a week in a long time. I'm either a genius, or we are about to get absolutely steamrolled this week....

 

[TheTalkingMule]

Man, I am loaded to the gills on 1100 and 1150 sold calls. I haven't "made this much free money" in a week in a long time. I'm either a genius, or we are about to get absolutely steamrolled this week....

Even if there's a squeeze on the split or some mega announcement Wednesday, you should be able to roll up and out for a few weeks and eventually expire 1100's. Nice problem to have if it happens!

Worst case, you maybe sell some shares ~1200 and keep all the premium(s).

 

[phantasms]

Topped out a smidge higher than 930 but so far call IVs are holding. I'm thinking calls are being slowly bled out as to maximize profit. People are taking advantage of this pump to load puts, a lot. Looks like we will see 930 or even 950 again this week as SPY makes it to 420. That's probably why we're not crashing yet. Traders are still betting on SPY 420.

Why 930? The stock just finished a 3 wave move. 675 - 842 = 167
It then dropped to 768. 768 + 167 = 935.
HOD? 935.5.

Now it's a matter of where TSLA ends up after all short term profit has been taken.

Duuuude.

 

[Discoducky]

So, is the pushdown MMs selling off to hold the call walls? I was actually able to get some $1000 CCs thx to members who did the same and gave me confidence. They are at 60% profit.

 

[Drezil]

Just sold a bunch of $1000's for $5.55 each...

No worries on rolling these if needed but too good of a deal to pass up with everything else red this morning.

Closed mine for $3, order to sell for $5 is already open again.

Edit: was too early .. i thought we'd bounce at least when we hit the friday close.. now it's @1.80 ..

 

[Discoducky]

Closed mine for $3, order to sell for $5 is already open again.

Just BTC mine at 64% profit and WWDD seems like a good play as I'm now on a long plane ride.

 

[ReddyLeaf]

The stock is due for a breather here shortly. It is staring up a confluence of formidable barricades: 200 SMA, psychological resistance of 900 and the next fib channel. Notice how the same fib channel stopped TSLA in its track back in May @ 950 after FOMC. SPY was 430 then. SPY is 410 now. Can we see 900? Yes. Can we see 925 if SPY gets to 420? Yes. But this is where the big bad bears are lurking. I think there is a slim chance we get to test the upper trendline @ 1060 in 2 weeks if the best case scenario plays out:
1. SPY gets to 430
2. July China sales spectacular
3. A split is announced and conducted shortly after.
Other than that, at 900 I think we have a pretty good spot for profit taking.

View attachment 834388

This is why I come to this thread, absolutely fantastic information. You should be a mandatory daily poster, along with @Yoona, @Drezil and a handful of other posters. Thanks to everyone. I wish that I could provide even 1/100th of the knowledge that everyone else does. My best input is to not make my mistakes (like selling CCs in front of this freight two weeks ago, because now I’m rolling DITM 750-800s). I’m still trying not to make daily FOMO mistakes.

 

[ReddyLeaf]

Topped out a smidge higher than 930 but so far call IVs are holding. I'm thinking calls are being slowly bled out as to maximize profit. People are taking advantage of this pump to load puts, a lot. Looks like we will see 930 or even 950 again this week as SPY makes it to 420. That's probably why we're not crashing yet. Traders are still betting on SPY 420.

Why 930? The stock just finished a 3 wave move. 675 - 842 = 167
It then dropped to 768. 768 + 167 = 935.
HOD? 935.5.

Now it's a matter of where TSLA ends up after all short term profit has been taken.

Amazing!

 

[samppa]

Question about leap-coveres calls: have you ever had these early assigned?

What happens if they do? Broker initiates a short position on TSLA for you, then you just exercise the LEAP?

If you hold stock and leaps, will they just sell your stock to cover assignment?

 

[MP3Mike]

If you hold stock and leaps, will they just sell your stock to cover assignment?

Yes.

 

[ZeApelido]

After my mistaken call purchase last week, I successfullly sold $1000 calls for $6 earlier. Just closed them for $1.9.

My white male privilege allows me to be overconfident and ignore the prior mistake and now think I am an options genius yet again.

 

[MikeC]

Question about leap-coveres calls: have you ever had these early assigned?

What happens if they do? Broker initiates a short position on TSLA for you, then you just exercise the LEAP?

If you hold stock and leaps, will they just sell your stock to cover assignment?

If early assigned, you should be -100 shares and still have your LEAPS.

If you also have the shares, you will have 100 less; if you don’t already have shares you will be short 100 shares.

 

[phantasms]

After my mistaken call purchase last week, I successfullly sold $1000 calls for $6 earlier. Just closed them for $1.9.

My white male privilege allows me to be overconfident and ignore the prior mistake and now think I am an options genius yet again.

 

[Drezil]

You should be a mandatory daily poster, along with @Yoona, @Drezil and a handful of other posters.

What is it those YouTubers always say?
Don't forget to like & subscribe, follow me on Patreon and remember to come here again tomorrow... or so ..

Sadly i don't have a Patreon ..

 

[dl003]

The stock smells funny again. Today we have a super duper bearish daily candle, yet call IVs are holding steady. I think someone is waiting for something. Could be the 8/4 meeting and they hope for a split announcement Friday morning? SPY 420? Call IVs don't hold like this unless something big and unexpected by most is about to happen. My bet is a credit rating upgrade from either SP or Moody. That is if tomorrow we don't dive hard at the open.

 

[MikeC]

The stock smells funny again. Today we have a super duper bearish daily candle, yet call IVs are holding steady. I think someone is waiting for something. Could be the 8/4 meeting and they hope for a split announcement Friday morning? SPY 420? Call IVs don't hold like this unless something big and unexpected by most is about to happen. My bet is a credit rating upgrade from either SP or Moody. That is if tomorrow we don't dive hard at the open.

My guess is people hoping for a bounce coming out of the shareholder meeting - but this feels like a buy the rumor, sell the news situation to me.

Holding 8/5 CCs: -950c, -990c, -1000, -1100, -1120c
8/5 CSP: -830c
8/5 BPS: -p835/735

 

[OrthoSurg]

“Hi. My name is Gene and I sold a 900c for this Friday last week. I’d like to talk about my feelings. “

“Hi Gene”



As much as I want to roll it up and out, with that gap at ~750, new super duper COVID going around sure to hit China, and the possibility this is a bear market bounce, I wonder if I let it roll and get back into selling puts. 900 is where that put executed which is how I got these shares anyway. I essentially have zero cash to trade with at this point. I want to be “all in” but it might be wise to let it roll. Sigh.

« Hi Gene,

my name is Captain Crunch and my sold 950CC last week for $1 did not look extremely happy when they were $20 today. My -2000% sold CCs would like to meet your 900CCs and drink and forget they ever existed. » -CC

 

[scubastevo80]

I wrote 950/1000 on the 29th for $2. Obviously too soon, but I think the stock has gotten ahead of itself in the short term. When we go from oversold to overbought in 2 months, I'm more likely to make aggressive call trades. This could certainly blow up in my face, but I don't think we go parabolic in this market with all of the existing problems we had a few months ago still lingering (inflation, supply chains, Russia/Ukraine).

 

[adiggs]

My read on things - I continue to be bearish over the summer (Aug + Sept) with Ukraine, inflation, rising interest rates, and the semi-hidden quantitative tightening (it gets almost zero financial media coverage).

That being said, I also continue to view a sharp move up to be the biggest risk available, even with shares around 900. In particular, and I wish I didn't have these 900cc for this Friday, I think we might be seeing another share value reset coming up with the shareholder meeting and details of the split going public (mostly the timing). We've had a few events over the last decade where the pressure built up, and then in a short time period (3 months or less) the share price left the old trading range and went looking for a new trading range.

Because of macro I don't think we'll see that this summer, or at least it won't be a sharp fast move.

I also like the idea of a credit rating upgrade. The question I ask myself though is who is going to request the credit review? I see no reason for Tesla to do any general purpose borrowing (I exclude borrowing money that will be backed by leased cars). Who requests and pays for the review? My understanding is that the credit rating agencies don't just do credit reviews - they do them when they get requested and paid to do them.


BUT the opportunity is here and I plan to be out of the way of the possibility. The available gains from the shares and leaps should this happen, when I sell into that run, will dwarf any cc premiums I can collect.

The tricky bit, and why I really wish I hadn't sold these 900cc, is that I won't be surprised if that move starts this week (larger naked shorts start closing those positions ahead of time rather than waiting for the last minute). The thinking here is that part of what would push the reset is the need for all of the short / naked shares to be accounted for. That will both remove them from the market, as well as shrink the float. The removal of those shares will have an outsized affect on the stock as the float is a lot smaller than the total number of issued shares.

In a stock with quarterly dividends or most every other company that doesn't have this level of short interest its really a non-event. I suspect, but don't know, that Tesla has a high and semi-permanent naked short position. Long enough duration that it meaningfully increases the available float.