Wiki Selling TSLA Options - Be the House

[intelligator]

I'm going to remain positive until it isn't ... gamma slightly negative, oh no, here we go
Strong OI pulldown at p190, 180, then 195. Slightly less OI at c200 , well backed by 205 and 210. Let's see what happened today when OI is published again tomorrow morning. For now, my $10 wide short leg IC at -p182.5 and -c215 is looking good. While the bottom could fall out, there will be time to manage. Gamma flip is 195, 190-200 seems to be a reasonable range.

 

[willow_hiller]

I'm going to remain positive until it isn't ... gamma slightly negative

Could you explain how you use the chart of options gammas? I've tried charting it myself before, and the only pattern I noticed is that it biases negative on days when TSLA is down, and biases positive when TSLA is up; so it works as a trend indicator? Would be interesting to see how it compares to a simple moving average, or something like a MACD.

 

[OrthoSurg]

With Powell talking tomorrow and Wednesday, it's less worrisome than normal.... He could make the markets rocket or tank with one sentence.

The most Powelful human on the Economy

 

[intelligator]

Could you explain how you use the chart of options gammas? I've tried charting it myself before, and the only pattern I noticed is that it biases negative on days when TSLA is down, and biases positive when TSLA is up; so it works as a trend indicator? Would be interesting to see how it compares to a simple moving average, or something like a MACD.

OK... *THIS IS MY UNDERSTANDING AND HOW I USE THE CHARTS*

How to use the chart, probably best to find material describing gamma exposure and delta hedging to form your own understanding.
True, the gamma +/- does tend to lean with the trend. TSLA price movement seems to be driven by options trades. The chart bars are based on a calculation that takes open interest , IV, DTE and the gamma greek measure for each strike to imply where the most exposure is put and call side. Gamma is highest at and near the money, forming a bell shape curve, positive and negative. You can find write ups on this... when we have negative gamma, market makers are providing liquidity through buying of shares when most are shedding. The put side bars extend further to the lower end of the gamma scale, outweighing the call bars, hence negative gamma. Similarly, positive gamma occurs when there's more OI to the call side, the call bars extend to the positive end of the gamma scale. Market makers are selling shares accumulated when demand is greater than supply. Today we are -0.01 , about even. When the numbers are published in the morning, I'll post another chart. Comparing that to todays, we'll get a sense of where the shifts in OI occurred, getting a read of the day perhaps.

Am I reading anything into this and basing my trades on the same? Not really. It's just one data point I look at. I use the chart more of a visual to spot the strong boundaries, clustering, or generally flat characteristic-less bars to imply how narrow or how broad price movement *might* occur. No tea leaf read here ... nothing that I can attribute to successful trades by this data only.

EDIT: I couldn't add to the other post, timed out. Here's the same bars with gamma overlays to correspond with the bell shape curve I described. Thanks for asking. Anyone that can add to this or right the wrong, please do. I am learning as well.

 

[EVNow]

The 3/17 p160s and p250/p260 spread are perplexing. Thoughts?

3/17 P160 could be a simple defensive put.

P250/P260 is someone trying to buy TSLA at current price but after 3/17 ?

 

[treb]

Was there a loss in any of those transactions? If there was no loss(after closing a transaction) I'm not sure why you are worried about wash sale.

Yes, rather substantial losses unfortunately. After the option was assigned, I kept waiting for TDA to list the sale of the 100 shares in the "unsettled closed positions" category so I could assign specific tax lots as close to the SP of 160, or slightly less, knowing that I would not be able to recognize any losses on shares with a cost basis of over 160 because of the wash.

Kept checking over the weekend, then monday, then tuesday - nada. Got busy with work and didn't get around to calling TDA until Wednesday - at which point, they told me the shares had settled and they had assigned my highest cost basis to the sold shares. Shares I purchased in the mid 300s and higher. Oof.

My bad for not calling TDA sooner, so now I'm just trying to ensure I can actually recognize the losses on the remaining 76 shares.

 

[EVNow]

My bad for not calling TDA sooner, so now I'm just trying to ensure I can actually recognize the losses on the remaining 76 shares.

Just don't buy any shares for 30 days, you should be good. Also better to avoid options.

 

[mongo]

Just don't buy any shares for 30 days, you should be good. Also better to avoid options.

Sir, this is a Wendy's.

(or ma'am)

 

[vikings123]

Yes, rather substantial losses unfortunately. After the option was assigned, I kept waiting for TDA to list the sale of the 100 shares in the "unsettled closed positions" category so I could assign specific tax lots as close to the SP of 160, or slightly less, knowing that I would not be able to recognize any losses on shares with a cost basis of over 160 because of the wash.

Kept checking over the weekend, then monday, then tuesday - nada. Got busy with work and didn't get around to calling TDA until Wednesday - at which point, they told me the shares had settled and they had assigned my highest cost basis to the sold shares. Shares I purchased in the mid 300s and higher. Oof.

My bad for not calling TDA sooner, so now I'm just trying to ensure I can actually recognize the losses on the remaining 76 shares.

Wow that’s brutal.

I feel like IBKR is the best. Unsettled shares show up in a couple of hours, lots of flexibility with how you assign tax lots and really good reports. Obviously the biggest downside is how they don’t have margin callls which is fine by me since I don’t use much margin anyway.

Anyway, to avoid wash sale I was able to buy DITM LEAPS. I also avoided selling puts because I did not want to get assigned. And like someone suggested just don’t buy for 30 days and it should reset.

 

[phantasms]

At open I sold a p185 for this week @ $2.46. Enjoy buying shares for $81 this Friday.

 

[UltradoomY]

Opened Strangle - STO $190P / $200C - $8 each - Let's goooo Theta!

Closed the call side this morning BTC - $1.75 each - could have gotten better if I waited I'm sure but I like to take the early close for over 50% for less than 24 hours.

Leaving the Put side - these are underwater now - opened at $3.50 each - now sitting around $4.25
Willing to take the assignment on these or close for $1 or so on Friday depending.

Today I also rolled ALL of my January 2025 $200 Calls out to the June expiration (06/2025) for a $500 debit each ($5)

Also started to scale more into the June 2025 $250 leaps at average of $52 each.

Now all leaps are at max expiration and not mixed between the January and June 2025's

I wanted to do this now because I want to be in front of the P&D report and April earnings - will look to deleverage into the summer where we have been stagnant for the past couple of years.

Still sitting on a good amount of cash for Put sales and ready in case we have a drop.

Cheers and good luck to all.

 

[EVNow]

Looks like there will be a battle for 190 today.

 

[SpeedyEddy]

188 coming in a bit later than I presumed.. but my yesterday's warning still applies. BRACE !

 

[Cherry Wine]

JPow not doing the market any favors.

 

[SebastienBonny]

Looks like I was just too late to file my BTC order for 210 CC.
Wanted to close it at 80% gain (0.29), but it just missed it by a dollar.
Maybe it'll execute when we get back under 188.

Edit: well, almost back where we were at the open now

 

[intelligator]

Looks like I was just too late to file my BTC order for 210 CC.
Wanted to close it at 80% gain (0.29), but it just missed it by a dollar.
Maybe it'll execute when we get back under 188.

Edit: well, almost back where we were at the open now

I'd considered same, to close BCS but also thought it might have been a good opportunity at that dip to sell a lower priced BPS in place of the -182.5/+172.5 I opened yesterday. I didn't make a move on either.

 

[bry_bry]

I've been rolling my CCs from late January to now. Painful but all for net credits. Covered calls: 190c, 170c 4/21. I've turned these into strangles today, Short Puts: 160p 3/31, 150p 4/21.

Current strategy to continue to roll up my CC for net credit, while scalping short puts below.

 

[BornToFly]

I might have done something silly today. I closed some of my +175/-200 Jan 2024 BPSs for 25% loss (after tax considerations, compared to letting them expire worthless next year). It does really help me with margin if we go back down to 100, which is why I did it. But, I never would have considered doing it if the SP stayed over 200. So maybe I let emotions dictate my trading.... The other thing I had considered was selling shares around 190 in case we kept dropping. But while that also gives me more margin, if we drop and stay there, the BPSs would have continued to be a problem. By closing the BPSs for margin instead of selling shares, at least now those BPSs are gone, and I still have the shares if we get the climb we all expect eventually.

 

[EVNow]

It does really help me with margin if we go back down to 100, which is why I did it.

Thats a long way away. TA folks tell us TSLA is just trading sideways in a congestion zone unless it breaks down below 187 (or up above 221 ?). Then, there is the big 160 to 150 band that should provide support.

Ofcourse if P&D and ERs come well below expectations then I'd expect to revisit 100.

 

[BornToFly]

Thats a long way away. TA folks tell us TSLA is just trading sideways in a congestion zone unless it breaks down below 187 (or up above 221 ?). Then, there is the big 160 to 150 band that should provide support.

Ofcourse if P&D and ERs come well below expectations then I'd expect to revisit 100.

Right. I don't think we get to 100 again, but closing the BPSs becomes very expensive and doesn't help margin if the SP keeps dropping. So 160 would have been very painful.

OF course, now we are Green for the day....