-
Want to remove ads? Register an account and login to see fewer ads, and become a Supporting Member to remove almost all ads.
Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Nothing pops up within 200 miles but I bet the $250 down payment I would get a quick Tesla phone call for delivery before the end of year. Heck, I need to go to the local Tesla store anyway. It would be cheaper to ask a sales rep.
I need to deleverage before the next drop.
I don’t know which indicator to follow or if I sell right before earnings but I am still leveraged with all the assigned puts lately I need to trim down these shares and time the high. I was never good to do that.
I had to sell 700 shares at $112 that is my hedge
. Margin is the devil; I still have $79k in margin debit and I want to try to get rid of it ASAP. It is not that much money but all piggy banks are empty and everything is tied up on my retirement accounts which I can't access. As soon as I get rid of that debt I am switching my account back to a Level 2 Options level; everything must be cash secured from now on. I need help timing some ATH CC's to get rid of the margin debit but I suck with my timing. Maybe going into ER I might try it.
What is "loaded with inventory" defined as? All markets inside California is 10 hour or less drive from Fremont. If I had no cars in San Diego, I would still be listing inventory for sale. Nothing in hand but 10 hours away is "close enough".
Cars are still being created as we speak. 1-3 days of inventory at the start of 2023 is not a problem.
Paint is barely dry on cars being listed. The only way Tesla can squeeze any more juice is chartering flights from markets like WA straight to the factory for pickup on 12/31.
Wrong thread
More appropriate options discussion: Has anyone looked at selling a put to pay the premium on buying a call? Margin of CSP? I was looking at selling Jan25 ATM CSP and buying OTM call, something like this: -p120, +c130. Initially, I thought this might be a “free premium” way of buying LEAPs, but on reflection it seems like trying up too much cash/margin longer term ($120). If selling weekly ATM straddles, it should be possible to average $2+/wk x 100 wk = $200+. Yes, the weeklies are more work and need to be adjusted, additional cash input on rising SP, bid/ask slippage, etc. But the -p/+c LEAP risks total loss in SP doesn’t rise. I suppose this is similar to buying or selling call spreads.
Anyway. I’ll just stay with weekly short straddles & strangles (CCs/CSPs) for the foreseeable future. I’ve got two month’s worth of living expenses on the line right now with only 1 DTE, and I know one side wins. Amazing! I may just wait until Wednesday to do these in the future.
More appropriate options discussion: Has anyone looked at selling a put to pay the premium on buying a call? Margin of CSP? I was looking at selling Jan25 ATM CSP and buying OTM call, something like this: -p120, +c130. Initially, I thought this might be a “free premium” way of buying LEAPs, but on reflection it seems like trying up too much cash/margin longer term ($120). If selling weekly ATM straddles, it should be possible to average $2+/wk x 100 wk = $200+. Yes, the weeklies are more work and need to be adjusted, additional cash input on rising SP, bid/ask slippage, etc. But the -p/+c LEAP risks total loss in SP doesn’t rise. I suppose this is similar to buying or selling call spreads.
Anyway. I’ll just stay with weekly short straddles & strangles (CCs/CSPs) for the foreseeable future. I’ve got two month’s worth of living expenses on the line right now with only 1 DTE, and I know one side wins. Amazing! I may just wait until Wednesday to do these in the future.
Last edited by a moderator:
SebastienBonny
Member
In my view you could roll the short dated sold call up and out.
I think it could be a small profit, but it depends what strikes you have…
Can you give strikes and expirations?
Another CC warning from me: If selling weeklies against LEAPS (calendar spread), realize that the CC going DITM on a major rally will essentially evaporate the time value of that spread.
Example: Say you have a 2025 +120c and you sell a 6/23 -120c against it. If we get back to 400 in 6 months, they’ll both be worth about the same amount of money because they are so DITM, despite the 2 year difference.
Last edited:
All we need is two weeks of ~8% daily gains and we’d be knocking on the door of all time highs.
I bought 2x +60c 2025 Jan yesterday at $70 just for experience, now its value is $78.xx . I plan to sell some -150c next week if P&D is good thinking 5-7% gap up is possible, but also have a stop loss at BE and take whatever market offers on Tuesday morning if P&D sucks.
150-160 is weekly SMA200 and where Elon sold shares a few weeks ago, so I believe it wont pass that level in one attempt.
This is my first time doing LEAP, so I hesitate to do any aggressive short call until I fully understand it.
I screwed up in that position on the first run from 300 -> 900 before the first split. Had 500 and 600s that I was sure were safe because we’d never even been out of the 300s before. Held on to them way too long waiting for the stock to come back down.
That was one of the rare major rallies we’ve had but TSLA is so oversold I think it could reasonably double from here if everything falls into place over the next few months.
What I would do differently now is, if the short call gets so far into the money that there are no more good weekly rolls, just close out both positions. I think the absolute gain (not %) on the LEAP should be a little more than the loss on the short call at that point. Don’t just hang on to a DITM short call that will lose money faster than the LEAP gains it, all the way back up.
Having played around with ChatGPT lately, it definitely feels like it's more of a "curated" response system. So isn't asking ChatGPT about dead-cat bounces no different from confirmation-bias (because everyone thinks so, then it must be so)?
Thanks for your post; excellent opportunity to clarify the strategy in my mind:
1) You bought a 60c LEAP for $70 -
does this mean your minimum CC strike is $130 ($60+70)?
2) If you sell a LEAP based $150c and the SP blows through it -
what is the management strategy - buy it back? rolling? cash in the LEAP?
3) As the Expiration approaches,
do you roll it, exercise it, sell it…?
4) The pros seem good enough; if I went ALL IN,
what are the cons to having a ONLY LEAPS portfolio?
Taxes? Risks? Liquidity? Leverage?
Assuming chatGPT (or any AI) is based on totally unbiased programming is too much of stretch for me.
On #4 - that's what I'm close to doing. Actually most what I've done, with a plan to roll the rest of the shares into leaps if we get another leg down. If the stock takes off then I'm ready for that. If we have another leg down to say 100, then I'll get even more loaded up.
The con is that the long term investment mindset has to change, somewhat, using the 2 year options. When you switch from shares to options, even 2 year options, you are now "on the clock". You can't just hold for 5 years or whenever the market recovers - you run out of time in 2 years.
You can mitigate that - the big time decay is in the final 3-6 months, so plan to be out of the leaps with 3-6 months to go until expiration. If the share price is way beyond the leaps then you might continue holding as there is little time value remaining - the options are acting like shares at that point, and you are just looking to pick your exit.
If the share price is about the same as when you opened them, then you roll 'em out to get back to the 2 year time window. Maybe sell some cc's along the way to pay for that time value.
If the share price is well below when you opened them, then again - roll.
The problem is that now you have elements of shorter term market timing as part of your position, and you have to make those decisions. With shares you can easily ignore them. Worst case you'll take em for another ride down adn back up
not-advice
I started buying leaps on the way down, with the bulk and original purchases Jan '25 200s when the share price was around 280. I added to that position further down, around 180 and 140?
Looking to add Jan '25 150 strike calls if we break down again when I semi-expect next week, after P&D is out and the FUD has had time to works its magic. Then again maybe this last couple of weeks has been a perfect storm of everything mechanical that could go wrong, and the market is about to realize a $200 asset is selling for $120.
Same common-sense rules apply to selling calls LEAPS as against shares, if you sell ATM calls against ALL your shares and the SP goes way up, essentially you've capped your profits, same with LEAPS, you've got no wiggle-room
The only reason you should go all-in on calls or puts ATM is if you want to sell or buy and lock-in the current price, if you're doing it because you're predicting the stock to go the opposite direction then 50/50 chance you'll be wrong, it's pure gambling
If you're looking to use calls for regular income then you need to either sell on a smaller %age of your available contracts, at a strike price you're OK to sell some shares at, and/or at a strike price which is highly unlikely to go ITM, like 25% Friday to Friday (not guaranteed, but historically never happened)
Not advice, of course, just personal experience of my own bad choices in the past, betting the farm is only a good strategy when you actually want to lose the farm
Similar threads
