Wiki Selling TSLA Options - Be the House

[intelligator]

Yes, the idea being the ITM calls are very unlikely to go OTM, so take some put premiums with essentially zero risk, not zero, of course, but you get the idea

The best i have to work with is to sell a 2/17 p177.5 , the short leg is the other end of the straddle, the sold put insured by buying the p157.5 on the long side ... a BPS using margin. Not the same as a strangle but not bad return of $620 on $10k 8DTE if opened Thursday at $201 price point.

December black swan flushed my cash reserves. Slow and steady earn and avoid dumb sale of calls is how I work my way back.

Thanks for sharing these strategies.

 

[SebastienBonny]

Something to take into consideration.
We went from 100 to 200 to gain 100%.
200 to 300 is only 50%. Don’t be trapped by thinking a 20 dollar rise is a lot, cause that’s only 10% now, while it was 20% at 100.
Just keep thinking percentage-wise. 20% OTM is 240 right now, while a 40 dollar rise looks huge, it just isn’t anymore at these levels.

 

[Krugerrand]

Looking to me like a near term correction is at hand for TSLA, based on the hourly and daily charts. Could see sub-$180 by Friday if we break below EMA at $195.
$165 looks like a support level.

This expectation subject to being trumped by news , of course

I’m curious. How many more days will I read about this ‘correction’ before it actually happens? If we go back two weeks, we can reread daily posts about the correction, the retracement, that’s coming when it it hits $181, 183.45, 187.19 -

Eventually somebody will be right, but so far the bets for the correction are butkus.

 

[MrMoo]

I’m curious. How many more days will I read about this ‘correction’ before it actually happens? If we go back two weeks, we can reread daily posts about the correction, the retracement, that’s coming when it it hits $181, 183.45, 187.19 -

Eventually somebody will be right, but so far the bets for the correction are butkus.

Well if TA was actually accurate a lot of people would be trillionaires by now.

It'll happen when it happens and if it doesn't then it'll happen some time in the future. Unless of course it doesn't in which case it'll retrace in another band.

 

[MikeC]

What is everyone doing with their old OTM puts?

I had a handful of ATM -p300 in September that went ITM fast and I split too early on the way down causing a real liquidity headache at the bottom. Had them as 1/25 -p290s for safety but been split-rolling them in and flipping/expiring them over the last month. I'm down to a few -p190 and -p200 for Feb and some June -p200s. Feeling better now that even if we do get another nasty dip, I won't get assigned or margin called.

On the calls side, I have more 1/25 -c400s than I want. I'm comfortable with the 1/25 -c600s.

Also turning LEAPS back into calls, little by little, but still have a lot that are far OTM until we get back to 250+.

 

[intelligator]

What is everyone doing with their old OTM puts?

I had a handful of ATM -p300 in September that went ITM fast and I split too early on the way down causing a real liquidity headache at the bottom. Had them as 1/25 -p290s for safety but been split-rolling them in and flipping/expiring them over the last month. I'm down to a few -p190 and -p200 for Feb and some June -p200s. Feeling better now that even if we do get another nasty dip, I won't get assigned or margin called.

On the calls side, I have more 1/25 -c400s than I want. I'm comfortable with the 1/25 -c600s.

Also turning LEAPS back into calls, little by little, but still have a lot that are far OTM until we get back to 250+.

I have 6x 1/25 -p280 CSPs that I had to manage Dec/Jan from 9/24 -p290s, don't know what to do with them. They should be good down to 120 but would be nice to get that cash back.

 

[Oil4AsphaultOnly]

What is everyone doing with their old OTM puts?

I had a handful of ATM -p300 in September that went ITM fast and I split too early on the way down causing a real liquidity headache at the bottom. Had them as 1/25 -p290s for safety but been split-rolling them in and flipping/expiring them over the last month. I'm down to a few -p190 and -p200 for Feb and some June -p200s. Feeling better now that even if we do get another nasty dip, I won't get assigned or margin called.

On the calls side, I have more 1/25 -c400s than I want. I'm comfortable with the 1/25 -c600s.

Also turning LEAPS back into calls, little by little, but still have a lot that are far OTM until we get back to 250+.

I've rolled mine into ITM short puts (April/May/June expirations) to pair them with my OTM cc's as a short strangle. As the SP moves up, I'll roll the strangle up to keep the puts ITM and the calls OTM for a small credit each time. I'm doing it this way, because I believe the SP will continue to rise long term, but have no idea how to play the short term. At some point I'll run out of cash to cover those rising put options, in which case I'll probably wait until the puts expire and figure out how to flip the covered calls one option at a time.

 

[SebastienBonny]

Premarket's on fire. Looks like 210 CC might be in danger. Will see what happens at open to keep it or roll to next week's 220 or even 225 (for credit).

 

[OrthoSurg]

Premarket's on fire. Looks like 210 CC might be in danger. Will see what happens at open to keep it or roll to next week's 220 or even 225 (for credit).

Been waiting for the correction to roll my Jan2025 370CCs back in but it seems they will soon be ITM

 

[juanmedina]

How long are you guys keeping your LEAPs for? I wonder if the shareholders meeting will be a sell the news event.

 

[mongo]

How long are you guys keeping your LEAPs for? I wonder if the shareholders meeting will be a sell the news event.

Either too long, or not long enough...

Oh, you wanted to know how long one "should" keep them???

 

[ZeApelido]

 

[UltradoomY]

How long are you guys keeping your LEAPs for? I wonder if the shareholders meeting will be a sell the news event.

There is no "right" answer because it is different for every person and also every strike....

I personally want to move or sell my leaps if they are ITM before the 6 month theta burn starts.

Usually with a leap (IV dependent) will start to burn theta at accelerated rates when it hits --> 1 year -->6 months --> 3 months, etc.

For OTM Leaps I try to roll them a month before they hit the 1 year mark.

For lottery ticket Leaps - try and roll to keep them at max expiration always.

Right now I have a ton (for me) January 2025 $200 Calls that have an average cost of around $30 each and are now at around $70 (yesterdays close)

I won't be looking to do anything with these other than write Leap Covered Calls on them until around December of this year as long as we are well above the strike.

Using the proceeds from Puts and CC's and LCC's to buy June 2025 $250's at the moment as these will appreciate quickly if they go ITM.

 

[CHGolferJim]

Up or down?

 

[willow_hiller]

Either too long, or not long enough...

Oh, you wanted to know how long one "should" keep them???

I was actually musing over this the other day, thinking there might be a good exit-strategy rule of thumb based on some of the greeks.

For e.g. we know for a long option, Theta starts negative and continues to decrease as you approach expiry and the intrinsic value falls. And Delta starts positive, grows as an OTM option approaches ITM, or falls as an ITM option approaches OTM. So there may some sort of signal one could derive when Theta grows larger than Delta times the average daily Drift... which would be something like a proxy for the average expected daily change in an option's value.

 

[chrsk]

Max pain is now 190. The calls at 200 seems to have moved upwards in combination with a rise in 200 puts.

 

[juanmedina]

There is no "right" answer because it is different for every person and also every strike....

I personally want to move or sell my leaps if they are ITM before the 6 month theta burn starts.

Usually with a leap (IV dependent) will start to burn theta at accelerated rates when it hits --> 1 year -->6 months --> 3 months, etc.

For OTM Leaps I try to roll them a month before they hit the 1 year mark.

For lottery ticket Leaps - try and roll to keep them at max expiration always.

Right now I have a ton (for me) January 2025 $200 Calls that have an average cost of around $30 each and are now at around $70 (yesterdays close)

I won't be looking to do anything with these other than write Leap Covered Calls on them until around December of this year as long as we are well above the strike.

Using the proceeds from Puts and CC's and LCC's to buy June 2025 $250's at the moment as these will appreciate quickly if they go ITM.

All of mine are also 2025's with a little higher cost. I was just curious if you guys were trying to time the market because the recent run has been steep and it is only early February. I am not expecting to get the returns that I got in 2018 of 35x on these LEAPs.

 

[intelligator]

Max pain is now 190. The calls at 200 seems to have moved upwards in combination with a rise in 200 puts.


View attachment 905024

I saw the same last night, that shiny c200 OI continues to climb. What's up with 200, it's a hot strike a couple weeks now. OI on the put side increased (p180 subtly more) and so did the majors at c210, c220, c230.

 

[dc_h]

I’m curious. How many more days will I read about this ‘correction’ before it actually happens? If we go back two weeks, we can reread daily posts about the correction, the retracement, that’s coming when it it hits $181, 183.45, 187.19 -

Eventually somebody will be right, but so far the bets for the correction are butkus.

they are buttkicks for some of us.

 

[juanmedina]

I sold some 250cc's at $1.05 for next Friday.