Wiki Selling TSLA Options - Be the House

[BornToFly]

The Twitter trial is not until October. I don't get why he is selling now and before Q3 numbers are out. We would have been over 1,000 by Friday and probably over 1200 in two months if he had waited. I have made $Millions from my Tesla investment (so I can't complain too much), but Elon selling has also cost me millions (in option trades) by driving the SP down unexpectedly several times now. Trading is hard enough when you just have to figure out the company and the market, but Elon selling is like a wildcard you didn't know about that comes out of the deck and destroys your plan....

 

[MrMoo]

The Twitter trial is not until October. I don't get why he is selling now and before Q3 numbers are out. We would have been over 1,000 by Friday and probably over 1200 in two months if he had waited. I have made $Millions from my Tesla investment (so I can't complain too much), but Elon selling has also cost me millions (in option trades) by driving the SP down unexpectedly several times now. Trading is hard enough when you just have to figure out the company and the market, but Elon selling is like a wildcard you didn't know about that comes out of the deck and destroys your plan....

His probably shocked himself how low the stock got. If he loses this trial he needs liquidity. He would much rather sell now in the 900's than be forced to sell (or be front run if he loses the trial) in the 600's.

This market doesn't really care what the quarterly numbers are. It's all about the fed.

 

[Discoducky]

His probably shocked himself how low the stock got. If he loses this trial he needs liquidity. He would much rather sell now in the 900's than be forced to sell (or be front run if he loses the trial) in the 600's.

This market doesn't really care what the quarterly numbers are. It's all about the fed.

He may get the option to buy Twitter prior to the court hearing at a discount maybe? And has this secured enough funds so he wouldn't have to have a quick forced sale?

Anywho, with the semi now confirmed for this year, I'm wondering about my $1000 calls for this Friday

 

[samppa]

Love it, when my cc:s go itm Elon decides to sell shares and tank the stock

 

[MrMoo]

He may get the option to buy Twitter prior to the court hearing at a discount maybe? And has this secured enough funds so he wouldn't have to have a quick forced sale?

Anywho, with the semi now confirmed for this year, I'm wondering about my $1000 calls for this Friday

Elon wrote on twitter today that this should be enough to cover the funds (Even if some capital pulls out) and will avoid a forced sale.

https://twitter.com/x/status/1557198421206769664

The language is not 100%. As a statement like "it is important to avoid an emergency sale" doesn't outright say it won't happen. But he did say he was done selling. Answered with a firm yes.

I think it's going to come down to 2 things. The CPI tonight, which is probably the most important factor. Then if the MM's will allow it to break 1000 over 3 days. There is some significant technical resistance in the 900's which the MM's can use to hold the line until next week. But if the CPI is good you can probably unload the 1000's at a profit.

 

[Matias]

Elon wrote on twitter today that this should be enough to cover the funds (Even if some capital pulls out) and will avoid a forced sale.

https://twitter.com/x/status/1557198421206769664

He did not say that.

 

[jeewee3000]

He may get the option to buy Twitter prior to the court hearing at a discount maybe?

My 2cents as an attorney: at any point in a trial the parties can come to an agreement.

Often this is done to reduce the "trial risk". Usually both parties make concessions in order to strike a deal, since the only reason you settle is if you believe there is a reasonable chance the trial doesn't go your way.

Since the trial was announced I was thinking the lawyers are most likely leading confidential negotiations. Twitter (desperately) wants the deal to go through. Elon wants to buy Twitter, but feels he overbid. Neither want the time, cost and uncertainty of a court case.

If Elon were to pay let's say 75%/80% of the initially agreed purchase price, hereby acquiring Twitter and ending the trial, the market could forget about the whole thing.

I assume we'll get an announcement in this manner soon-ish, since Elon now has all the cash he needs (he thinks). More precisely I expect an announcement before September 16th (a good month from now).

This would also explain why Elon wanted to sell NOW instead of carefully waiting for the stock to appreciate further (as @BornToFly points out: Elon will very likely miss out on good gains by selling now instead of after Q3 P&D / ER).

Because of the above, I'm extra careful with selling calls in the next few months.

 

[traxila]

Problem:

-If EM is selling we probably have at least three more days.

-By the time he is done we might be in low 700s.

-Why the hell did I buy this dip aggressively when I knew this? No one cares about splits when the CEO is dumping a couple million shares a day.

Ask Yoona from her latest excellent post.

From Friday. I was right about Elon selling.

I was wrong about how low it could go.

Price actually held up pretty well in low volumes with Elon dumping. People want to buy. Now with EM out of the way for a couple of days ( ) maybe we can run for real.

 

[Discoducky]

Because of the above, I'm extra careful with selling calls in the next few months.

Agreed and why I'm buying some calls when the market opens. I've got a limit order, which will hopefully execute at market open for buying $1500 calls expiry 9/16 and 11/18

 

[Drezil]

With CPI looming and the ridiculous bargin we are getting on TSLA i opened the following:

- base should be a strangle or straddle because we either go up or down on the CPI
- not cost any margin (on my bullish setup)
- refinance theta a bit because i don't want to burn all the money

Ended up with:
+880c
+830p forming a strangle to take advantage of the spike in either direction
combined with an imbalanced iron-condor:
-900c/+950c for the BearCS
-810p/+780p for the BullPS

The theta of the straddle is still dominating like hell, BUT it is lessened (theta of 3 instead of ~5 iirc)
The straddle fully covers any loss the IC can have.
View attachment 838610
This is only 1 contract shown. I did 10x & it freed up 30+k margin because i "limited my portfolio downside" with those <$700-protection until friday -.-
Theta is 3, but delta gets high FAST so you only need a rough 25pt swing in either direction from here to close it out neutral tomorrow. And with TSLA swinging 50pts on "normal" days this seems feasible to close out with a profit.

Only downside: We stay hugged to the 850-wall for the rest of the week, even intraday, no matter the events (CPI, China invades Taiwan, Russia makes Peace, Asteroid hits Texas, $insert_black_swan_event_here)..

As a betting-man i would say "i like those odds"

Out shortly after open.
Sadly had to lower several times for a fill
Out for +1.4k instead of the +3k possible shortly after open. But prevented the -5k or so it would have had right now. That thing has an awful Theta with 3-4k PER DAY
(Note: image above is for 1x - i had 10 contracts. Add a 0 to each number in the image )
Now TSLA is surely going straight to 950 or dump to the 700s .. -.-

Or is this maybe one trade i might have had a lucky hand exiting early? ..

 

[strago13]

So yesterday in my brilliance, even though I still have some Jun 2024 1100's hanging around (ugh), I was going to sell some new puts that were fully cash secured. So in my infinite wisdom yesterday I sold 12AUG2022 800's for pennies, saw the news last night and went

This morning I was sweating bullets knowing the CPI data was coming. On the way to the beach, I saw it came in lower than expected and I put an order in to close my 12AUG2022 800's on open for 77% gain. Not bad for one day's work, but damn, that stress.

 

[ReddyLeaf]

Ok, you’re welcome. I sold a single -c905 today for $6.50, which now guarantees a continued rise. I was trying out @Yoona ‘s Fibonacci series technique and actual made a pretty well-timed trade. Sold at a local maximum, and the CC was down 15% in about 15 min. I don’t like to day trade in my IRA, so just let it ride. Unfortunately, 60-90 min later it broke resistance and started climbing away. Oh well, riding the tiger with @Max Plaid (on a much, much smaller dollar level). Fortunately, I have 2x 8/19 +c960s that can be used to offset, plus I wouldn’t mind letting this one exercise and play an ATM put next week.

On another topic: I’m starting to think more closely about Max’s weekly ATM straddle and allowing the losing side to exercise. FWIW, I rolled losing -p1000s & -p1100s from the beginning of this year all the way out to Jan23 and Sept22. Because of this, about 1/2 of my capital has been tied up, not earning premiums for several months. I continued selling CCs (<10% OTM) and was able to buyback a few puts after the March SP rise. However, I was recently caught in the late July SP rise, so rolled the -c750s out.

So now, you see my problem: I’m almost completely out of weeklies and have just about everything tied up in DITM CCs and CSPs. Furthermore, I’m pretty much out of free cash as well. It’s not a big deal since everything is share/cash-backed, but it’s not earning very much weekly premium (theta decay is very near zero on such DITM options). If I want to continue playing the options game, I need to wait months for exercise, which is probably exactly what the MMs wanted: For retail to get out of their sandbox!

So, not advice for the newbie: this is what can happen to you, even if you don’t “lose” money, you “lose” the opportunity profits.

Edit: well, at least if that -c905 exercises, I’ll have enough cash to buyback some (and maybe all) of the puts and calls in that account, so a complete reset.

 

[TheTalkingMule]

Trading is hard enough when you just have to figure out the company and the market, but Elon selling is like a wildcard you didn't know about that comes out of the deck and destroys your plan....

In this instance, and with the CPI and oil markets moving away from inflation, I think Elon's recent sale is a huge help to those in this thread.

Today's massive MMD tells me the MM's have no real fear of naked shorting, since they probably took the opportunity to cover and clear their ledger over the few days of Elon adding tonds of liquidity.

If that's true, we should tread water for the most part til we get closer to 3Q earnings. Only a mild pop on the split, then continued March north.

A slow march to $1000 as opposed to a rocket which probably could have happened today(CPI day) if Elon hadn't sold so much.

BPS/put selling should be mighty sweet the next little while, then you just need to be careful on the call side. Anyone really worried to sell 780p today? (sorry if jinx)

 

[Yoona]

Ok, you’re welcome. I sold a single -c905 today for $6.50, which now guarantees a continued rise. I was trying out @Yoona ‘s Fibonacci series technique and actual made a pretty well-timed trade. Sold at a local maximum, and the CC was down 15% in about 15 min.

coincidence! i also have same -c905 daytrade

 

[UltradoomY]

Ok, you’re welcome. I sold a single -c905 today for $6.50, which now guarantees a continued rise. I was trying out @Yoona ‘s Fibonacci series technique and actual made a pretty well-timed trade. Sold at a local maximum, and the CC was down 15% in about 15 min. I don’t like to day trade in my IRA, so just let it ride. Unfortunately, 60-90 min later it broke resistance and started climbing away. Oh well, riding the tiger with @Max Plaid (on a much, much smaller dollar level). Fortunately, I have 2x 8/19 +c960s that can be used to offset, plus I wouldn’t mind letting this one exercise and play an ATM put next week.

On another topic: I’m starting to think more closely about Max’s weekly ATM straddle and allowing the losing side to exercise. FWIW, I rolled losing -p1000s & -p1100s from the beginning of this year all the way out to Jan23 and Sept22. Because of this, about 1/2 of my capital has been tied up, not earning premiums for several months. I continued selling CCs (<10% OTM) and was able to buyback a few puts after the March SP rise. However, I was recently caught in the late July SP rise, so rolled the -c750s out.

So now, you see my problem: I’m almost completely out of weeklies and have just about everything tied up in DITM CCs and CSPs. Furthermore, I’m pretty much out of free cash as well. It’s not a big deal since everything is share/cash-backed, but it’s not earning very much weekly premium (theta decay is very near zero on such DITM options). If I want to continue playing the options game, I need to wait months for exercise, which is probably exactly what the MMs wanted: For retail to get out of their sandbox!

So, not advice for the newbie: this is what can happen to you, even if you don’t “lose” money, you “lose” the opportunity profits.

Edit: well, at least if that -c905 exercises, I’ll have enough cash to buyback some (and maybe all) of the puts and calls in that account, so a complete reset.

You can always roll them in!

08/26 BPS -$900 / +$600 are paying $55 each....
Just opened a bunch of these.

 

[adiggs]

Monday to Tuesday interest shifted from calls to puts, 950 and 1000 calls trimmed back, 900 held up, maybe profit taking the morning dip with sales of puts doubling down on 800 and 850. Is 875-880 in the cards for tomorrow?

View attachment 838881 View attachment 838882

Uhm ... wow. This aged well.

What's it gonna be tomorrow? And can you get that figured out by say 3pm eastern and posted?

 

[adiggs]

This is killing me - I've got a stack of uncovered shares and leaps that I want to sell cc against. Then I remind myself that we've got this split happening in a couple of weeks and I -WANT- them to be uncovered at least that long, and maybe longer. Which means much sitting on of the hands - must not trade.

I did decide to do a bit of window dressing today - rolled Jun '24 500 strike calls up to 600, taking out $58/share from each contract. I'm comfortable with these being a little bit closer to the money and I prefer having these at a nice multiple of 3 strike; if nothing else the new contract will be easier to trade after the split.

 

[Yoona]

 

[juanmedina]

I sold 1000cc at open for $1 and forgot to close them, now at $0.23 .

 

[BornToFly]

My brother got a call from Charles Schwab trying to get him back. He doesn't know what they will offer yet specifically, but should he even consider it for options trading and margin account? Fidelity has not changed the margin requirement for shares from 40% this year. I can't remember if CS is one of the brokers that screwed people over by suddenly raising it...?