Wiki Selling TSLA Options - Be the House

[ice]

I rolled my 7/29 -$760c $82.45 (SP around $842) to 8/19 -780c $82.55 (SP around $840), $20 strike improvement, no credit or debit , cumulative credit for this position is $53, so potential assignment proceed= $833/share
also rolled 7/29 -$740c $101.9 (SP around $841) to 8/19 -750c $104 (SP around $841), $10 strike improvement, $2 credit, cumulative credit for this is $61 so potential assignment proceed = $811/share

Leaving my 9/16 -700c (rolled from 5/27 -600c with credit) alone for now with 7.2 weeks left, there's still intrinsic on that one to decay

While I have missed gains, this has been a good situation to me 1 contract is for paying off margin and the other one is to pay for the almost monthly increasing Model Y cost, as long as I can keep up with margin interest/model Y interest increase, I'm content. This sure beats trying to work on my margin call spreadsheet everyday

The +$100/week freight train is running me over, especially the deeper ITM calls, it's getting hard to roll. So I decided to roll my 9/16 -700c to 10/21 -720c for no debit/credit before it potentially gets even harder to roll. Potential proceed $720 + $45 credit = $765/share. I've been rolling this position for 2+ months now with no end in sight, but improved strike by $120/share, any not-advice?

originally:
5/27 -600c
9/16 -700c
10/21 -720c

Kept the 8/19 -780c as is (cumulative credit $53), potential assignment proceed = $833/share.

In the tax free account, I do feel the fomo a little bit, so I closed the 8/19 -750c at a loss because I'm worried that if it goes parabolic (think $1200+), I will not have enough cash to roll anymore. (I can't contribute more money into this account due to tax rules, limited to $6k contribution a year) I had to take a $178 loss ouch. (minus $61 credit, net loss $117, but at least i get to keep the shares if it ) I will need the shares to go to $1040+ for me to gain back this loss. So if the SP dumps then I just took a loss for nothing. Right now there is nothing open in this account, but I'm not sure if I should open a new CC or wait until after the shareholder meeting/split.

With all that said, it's mostly just missed gains, there is not actual "loss", other than the loss buying back the 8/19 -750c, definitely a good problem to have over being margin called

 

[dl003]

The stock did not crater, nor did call IV crush, after reaching 935. We now have a real possibility of another, final leg higher. However, I suspect TSLA won't be able to go ham without SPY conquering 420 first. Very stressful few days.

 

[phantasms]

I see some of you chose today to roll calls out of this week. Is there any strategic advantage to that? I'm still holding my 900c for a potential sell the news pullback. I've been eyeing rolling to next Friday 910 for ~$10 in credit or the monthly 8/19 for zero credit to 940-960 [depending on current share price]. Any reason you guys rolled today instead of on Friday, especially considering how underwater some of them were.

Thank you!

 

[Yoona]

"TSLA in full bull trend" (starts 8:31)

edit: careful with CC/BCS

 

[intelligator]

I see some of you chose today to roll calls out of this week. Is there any strategic advantage to that? I'm still holding my 900c for a potential sell the news pullback. I've been eyeing rolling to next Friday 910 for ~$10 in credit or the monthly 8/19 for zero credit to 940-960 [depending on current share price]. Any reason you guys rolled today instead of on Friday, especially considering how underwater some of them were.

Thank you!

My 775 had little time value left, i didn't want to fret much over it and rolled reluctantly for $3 to next week same strike. If there is strong pullback, will manage that if there is any steam left in it.

My 850 I rolled to next week 855 , for $7.50. I felt that was fair but could have waited that a bit more, I agree. Usually I roll Friday morning, this week is strange.

Looking at the gamma chart though, the same clustering as yesterday, with slightly more money shifting into calls. 890 and 910 weakened, 930, 940, 950 increased some.

 

[adiggs]

I have no positions open right now and I am thinking about selling December $1140 covered calls for $60. Those calls have 19 weeks to expiration and they would give me $325 bucks per week which is decent IMO with a breakeven of $1200. @adiggs any thoughts? Lots of great catalyst in the near term but the macro .

My not-advice thoughts.

I mostly see macro as being in control so I'm expecting the shares to turn back down.

But I'm also 'concerned' about the shareholder meeting, a share split announcement that will happen soon (end of August?), and that announcement leading to a market reset in TSLA valuation. I've seen a couple of these resets where investors suddenly realize that the share price is just wrong, and TSLA takes off to find a new balance / valuation. Those moves tend to leave the old trading range behind and never return. If that repeats then I would expect >$1250, and it won't be a squeaker. In this scenario a share price of $2500 won't surprise me (2x the old ATH).


Thus my own positioning. I have 900cc for this week that I opened prematurely. I wanted to have those shares/ leaps uncovered as we headed into shareholder meeting, so that just in case, I would get full benefit from that sort of share price reset. Oops.

My strategy for the next 2 days is to hope for a pause in this relentless move up - get some sort of move back towards 900, and take a small loss. I really don't like "hope" as my strategy


I don't sell options that far out (4 months in your example), so I don't really have much to say about those. I HAVE been thinking about 2 week out to 8 week options though - that's more recent for me and is part of a broader pattern within my trading to get positions I mostly ignore until Thu/Fri of expiration week. The buy-writes have been great for me along those lines. Maybe I should open some buy-writes with OTM calls instead of ITM calls. H'mm...

 

[scubastevo80]

I mostly see macro as being in control so I'm expecting the shares to turn back down.

But I'm also 'concerned' about the shareholder meeting, a share split announcement that will happen soon (end of August?), and that announcement leading to a market reset in TSLA valuation. I've seen a couple of these resets where investors suddenly realize that the share price is just wrong, and TSLA takes off to find a new balance / valuation. Those moves tend to leave the old trading range behind and never return. If that repeats then I would expect >$1250, and it won't be a squeaker. In this scenario a share price of $2500 won't surprise me (2x the old ATH).


Thus my own positioning. I have 900cc for this week that I opened prematurely. I wanted to have those shares/ leaps uncovered as we headed into shareholder meeting, so that just in case, I would get full benefit from that sort of share price reset. Oops.

My strategy for the next 2 days is to hope for a pause in this relentless move up - get some sort of move back towards 900, and take a small loss. I really don't like "hope" as my strategy


I don't sell options that far out (4 months in your example), so I don't really have much to say about those. I HAVE been thinking about 2 week out to 8 week options though - that's more recent for me and is part of a broader pattern within my trading to get positions I mostly ignore until Thu/Fri of expiration week. The buy-writes have been great for me along those lines. Maybe I should open some buy-writes with OTM calls instead of ITM calls. H'mm...

Do we really think trading will supersede reasonable valuations in this environment? Tesla would be expensive over $1500 and I’m not sure I’m still willing to pay more then 50x forward earnings anymore. I still believe in the story but I’m not an aggressive buyer unless we have a clear bull market in sight. This is coming from someone still sitting in a few LEAPs and who has 60% of their money in TSLA.

 

[scubastevo80]

Why are you telling us only afterwards? Maybe some of us want to play big gains, too ^^

I’m considering LCID BPS on the open about 10- 15% OTM given macros seem relatively stable and only 2 DTE. IV was extremely high on these yesterday, need to see what they look like this morning after LCIDs massive miss.

 

[SebastienBonny]

Do we really think trading will supersede reasonable valuations in this environment? Tesla would be expensive over $1500 and I’m not sure I’m still willing to pay more then 50x forward earnings anymore. I still believe in the story but I’m not an aggressive buyer unless we have a clear bull market in sight. This is coming from someone still sitting in a few LEAPs and who has 60% of their money in TSLA.

I'd rather want to see a steady rise at reasonable valuation than a quick rise to 1500 just to fall like a knife afterwards... But I do think it's possible because of FOMO and a lot of people will be thinking about the previous split and the gains they could make now.
For the next weeks I will sit back, relax and watch the show, unless we go down for some macro-reason.

 

[OrthoSurg]

"TSLA in full bull trend" (starts 8:31)

edit: careful with CC/BCS

Cory thinks if QQQ breaks above the double resistance at 324/326 the bear market is over. If the bears manage to short at resistance and send the qqq below then the bear market continues.
This might be a critical level to follow as if we get above that a lot of bears wil have ti cover their short positions and this will send Nasdaq higher.

We already have TSLA and AAPL leading the way in full bull so right now I agree CCs and BCS are very dangerous.

 

[samppa]

I'm sold, and gonna give this a go.
So did it
Sell -p2400 8/19
Buy +p920 jun 2024
Sell -c920 jun 2024

net credit $1533
Plan is to exit after iv crush.

margin effect: it lowered my maintenance margin by about 2k. I'm on IBs risk-based margin.

Well that 08/19 -p2400 was just assigned before market open. So now I'll sell those shares and another -p2400.. looks like might be better to go out a couple more weeks.

 

[Chenkers]

I have 1050CC and BCS for this week that I'm not overly concerned about at this stage. I could have closed them yesterday at around 75% profit but am still expecting a drop in IV and value after or before the shareholder meeting to be able to close them out more cheaply.

Yesterday I did close out some longer term CC that were left over from some BullCS that had the long side margin liquidated a few months ago. They were 2 x JAN'23 900CC and 2 x JUN'23 1000CC. I replaced each of these with 5 X 1100/1200 JAN23 BPS for a slight margin hit and extra cash left over. I feel more confident in these BPS expiring OTM or being rolled safely than having the JAN/JUN CC's escalate dramatically in value as TSLA recovers. I originally had 19 of these JAN'23 CC's so it feels good to finally see them gone and let the stock run free.

 

[MP3Mike]

Well that 08/19 -p2400 was just assigned before market open. So now I'll sell those shares and another -p2400.. looks like might be better to go out a couple more weeks.

I would expect something that far OTM to be assigned every day.

It would be interesting to know how much time value it shows for the next put you sell.

 

[JustMe]

Cory thinks if QQQ breaks above the double resistance at 324/326 the bear market is over. If the bears manage to short at resistance and send the qqq below then the bear market continues.
This might be a critical level to follow as if we get above that a lot of bears wil have ti cover their short positions and this will send Nasdaq higher.

We already have TSLA and AAPL leading the way in full bull so right now I agree CCs and BCS are very dangerous.

This feels a bit backwards to me. CCs and BCS were a lot more “dangerous” when we were trading below $700 less than one month ago. The economic challenges have not gone away and most analysts are now calling for a hard landing and likely recession.

Guys, zoom out and have a long look at the daily chart for the past 4 months or so. Sitting here at $950, I think it’s equally likely that we see $800 or $1,100 next.

Good luck today, players!

 

[Yoona]

today's Close = PM High

3rd day in a row R1 is ceiling (this week mon tue wed)

edit: tentative tomorrow's R1 ~932.74
View attachment 836273

today's R1=932.74 and PM is sticky there right now

 

[jeewee3000]

This feels a bit backwards to me. CCs and BCS were a lot more “dangerous” when we were trading below $700 less than one month ago. The economic challenges have not gone away and most analysts are now calling for a hard landing and likely recession.

Guys, zoom out and have a long look at the daily chart for the past 4 months or so. Sitting here at $950, I think it’s equally likely that we see $800 or $1,100 next.

Good luck today, players!

I agree in the short term.

After Q3 earnings however (end of October), barring possible factory closures in Q3 due to force majeure, I believe WallStreet cannot ignore the numbers and the stock will go >$1000 AT LEAST.

More likely $1200 in quick succession.

Short term, We could touch $800, I agree fully. That's why I'm not closing out some ITM cc's I'm holding on to. (currently 8/19 -c850's are my worst position, but these are a decent hedge should we sell off again)

 

[elasalle]

rolled some CCs to 1120 CC against shares I don't mind getting called for 8/12 for ~$1.80

If feast/frenzy continues ... need to have a good plan

IV still in the low 60 percentile ... thought it would be higher ...

 

[Drezil]

Well that 08/19 -p2400 was just assigned before market open. So now I'll sell those shares and another -p2400.. looks like might be better to go out a couple more weeks.

I just recreated a thing similar in IBKR..

Example 08/19 -p1500 has 0 theta and -1 delta as expected.
But 930p/-930c has -0.013 delta and 0.061 theta.. and "only" 0.038 vega...

Are that the readings on your position as well? Or am i confused?

 

[scubastevo80]

I wrote BPS 880/800 for 8/5 this morning. I now have an IC that sits between 950 and 880. I'm not expecting anything major or unknown on today's annual shareholder meeting, so I don't expect a +/-5% swing for Friday, unless macro's take off in one direction.

 

[JustMe]

I agree in the short term.

After Q3 earnings however (end of October), barring possible factory closures in Q3 due to force majeure, I believe WallStreet cannot ignore the numbers and the stock will go >$1000 AT LEAST.

More likely $1200 in quick succession.

Short term, We could touch $800, I agree fully. That's why I'm not closing out some ITM cc's I'm holding on to. (currently 8/19 -c850's are my worst position, but these are a decent hedge should we sell off again)

Samesies