Wiki Selling TSLA Options - Be the House

[DaBooster]

Today's Close = 248.48

I was right(!) last Tuesday pre-market guess, safe by 4.31

This week's High = 265.13, i'm only off by 30 CENTS

Great performance on the guesses

 

[EVNow]

I got 5.21% in my high yield savings account for the month of December

That’s annualized - besides you have to pay taxes (if not in tax deferred).

I switched to muni MM fund for that reason. Ofcourse you get less interest but helps with Roth conversion.

 

[adiggs]

But something like a vertical credit spread is such a defined rvr? Start with HTF charting to find support/resistance levels, check out your deltas on the side you want to play, check expected move for confirmation, then possibly go further out than that.
I have done the weekly CC/CSP, but not the other two so I will give them some study.

not-advice.
We each make our own decisions, and experience our own consequences.

That being said I assume that you've been through the Options Alpha options intro linked back on the first page of the thread. That level of knowledge is assumed in this thread. It's about 20h worth of videos, and a must watch / listen.


A cash secured put will go from a max gain (the credit received when the put is sold) to a max loss when the share price reaches $0. You have a LOT of runway to mitigate a loss - a max loss is effectively impossible.

However a fairly wide spread of say $30; let's use a -230p/+200p vertical put spread as a made up example. You are absolutely correct that your loss is defined and can not exceed $3000 minus the credit received. However the part that is easy to miss is that you only need to see a $200 share price to arrive at that max loss. My conclusion - depending on the size of positions and leverage that you use, the "defined loss" position (vertical spread) can be far riskier to your capital than the undefined loss position (csp or cc).


The other thing that you'll just need to take on faith if you haven't yet done any spreads, is that their behavior is just plain different from a cash secured put (or a share backed covered call). Assuming you've already got personal experience with cash secured puts and/or share backed covered calls, then the closest thing to advice I will make is to start your life in spreads off with single option positions. Since this is an educational exercise I would use weeklies (frequent feedback), and get these spreads into a variety of situations, and see for yourself how well they work for you emotionally.

Welcome to the thread!

 

[thenewguy1979]

This chart just screams to me..

THAT GAP MUST BE FILLED@!@$%%^

No worry. Wish granted by Elon. He say if it don't happen soon he will make it happen during his earning call like he always does. Remember the last one

 

[BornToFly]

I'm curious why people want to sell options during known times of volatility - esp. when the IV is so low, given the volatility anticipated.

I agree. I debated selling CCs for next week, but just 10% OTM was only 0.75. Not worth it. I will wait until after P&D on Tuesday. I'm still hoping we break the trend and go up next week since TSLA is oversold.

 

[BornToFly]

I am an amateur playing scales while many here are virtuosos - definitely not investment advice.
I recently switched to monthlies (from weeklies) around mid 2023

For my tax-free IRA account:
I set 25% of my assets with strikes ATM or $10 OTM
and 75% of my assets with strikes $30 OTM

For my taxable account:
I set 50% with strikes at $30 OTM
and 50% with strikes at $60 OTM

I have a 3rd Investment Account with low basis (cost) TSLA shares where I don't write options.

These are not set in stone. At times I sit on my hands and do nothing and there are times I will change my strike price or duration approach based on upcoming news or due to a recent drop or run in the stock price or based on what I am hearing from the people in this thread.

How did the monthlies work out? $60 OTM is just a little more than 20%. TSLA can easily do that in a month....

 

[bopdit00]

You all remember what happened last time Elon made this prediction? 2024 is a few days away. Tic Toc…

https://x.com/elonmusk/status/1740913974135459902?s=46&t=rw-a4PLRGtH4UiM9aADSJQ

 

[EVNow]

I agree. I debated selling CCs for next week, but just 10% OTM was only 0.75. Not worth it. I will wait until after P&D on Tuesday. I'm still hoping we break the trend and go up next week since TSLA is oversold.

Yes - I'll sell on Tuesday. May be after the dust settles a bit. Indications are that the actual will be close to expectations ... so, probably not a lot of SP movement.

Ofcourse depends on the market as well - which has run up a lot with no corrections.

 

[thenewguy1979]

Doggy prediction we flatline between 235-255. Tesla ran out of steam. Meeting PD going into the 2024 is nothing new - Tesla made PD many times.
The concern fresh out people mind is what Elon said last earning which still leave a questionable mark for the future.

Good PD - stock stay flat
Below PD - dump

IV was around 50% which was OK for an ICs. Maybe dog sense is wrong but it's a single contract bet, not 100x like big brother Max would do.

Happy New Year for those lurkers !!! Go have fun with your love ones.

 

[Artful Dodger]

Just sold 250calls on all my TSLA for Friday [Dec 15].

Did your shares get called away since TSLA closed above $250 on Fri, Dec 15 ?

 

[StarFoxisDown!]

Yes - I'll sell on Tuesday. May be after the dust settles a bit. Indications are that the actual will be close to expectations ... so, probably not a lot of SP movement.

Ofcourse depends on the market as well - which has run up a lot with no corrections.

Everyone and their mom was so sure of Q2’s delivery number just because Q1 delivery numbers were close to expectations and we all saw how that turned out

Not saying delivery number beat would force the stock higher, would probably need something decently over 500k for that level of surprise rally.

 

[dl003]

maybe he tried to soften the blow?

Sure as *sugar* he's trying, but name one time he's ever succeeded lol.

 

[The Accountant]

How did the monthlies work out? $60 OTM is just a little more than 20%. TSLA can easily do that in a month....

I stated in an earlier post that I switched to monthlies mid 2023 but I just looked at my spreadsheet and I made the change from weeklies to monthlies in September. So far I have been ok; even with my $30 OTMs.
I know I will get caught in a stock run at some point and my plan is to either roll up and out or lose the shares and write puts. These are shares in my tax free account and my trading account.

 

[Max Plaid]

Now if Elon start selling shares that will be much quicker......

Didn't dump in January, it pumped bigly - obviously because of the manipulated crash October through December...

 

[phantasms]

Did your shares get called away since TSLA closed above $250 on Fri, Dec 15 ?

Rolled to 290 1/19 for reasonable credit. Feeling pretty comfy with it.

 

[Max Plaid]

Im just going to go out on a limb here, but if Tesla actually come out with a ~ 20% projection for next year P or D growth, well Katie bar the door..I know, not till later in Jan, but still it won’t be well received. It’s REALISTIC, but not what FOMO, MOMO, growth managers or retail is hoping for.

for 2024, I would consider it SOLID, but still it’s going essentially nowhere, and will be seen as HALF the prior years growth and a DE-celeration for sure. If not for realz, for at least perception and perception is reality as far as the stock is concerned.

disclaimer: I’m down an inch.

Was already stated in Q3ER that next year would be lower growth. If Tesla can be convincing that this is more because of production constraints rather than demand then markets might be OK

Also if we see any margin improvelment that will help a lot, can also be that Tesla find a solution to the battery mineral issue in the US and bring the M3 back into the IRA, that would pop the stock I can imagine

Talking of M3, I'm just returned from a road trip to Denmark and I was astonished at the number of M3 Highlands I saw, there were typically two or three at each supercharger and many on the roads, they got out there pretty quickly

Juniper MY refresh will also bring even more interest to what is already the world's best selling car

And then we have Tesla Energy right, and perhaps some FSD recognition, we'll see...

In any case, I don't expect P&D to be a miss, I just don't think it will be the big beat I was looking for earlier in the quarter - I blame the stink bugs...

 

[Max Plaid]

So, was driving all day yesterday, tried to sell some -c270's for $2.3 in early trading, but maxed at $2.08. Later in the day, when it was wandering around $248-9 I put an STO 100x -c270 @$1.3, which triggered on the mid-afternoon "pop" up to $251

I feel $270 is pretty safe for next week, would still prefer to have sold Jan 26th -c270's, but that nice premium isn't there any more, let's see how it pans-out...

 

[Yoona]

@Yoona What is next weeks range?

i think next week 1/5 222.22-274.74 is safe for Iron Condor, it is only 10.56% OTM, though

15% OTM is 211.21-285.75

perhaps tighter guess tentative for now ~235-261

due to P&D and JOLTs, all bets are off

options chain guessing 235-265ish

if P&D is bad, we'll probably touch low 240's next week

 

[tivoboy]

i think next week 1/5 222.22-274.74 is safe for Iron Condor, it is only 10.56% OTM, though

15% OTM is 211.21-285.75

perhaps tighter guess tentative for now ~235-261

due to P&D and JOLTs, all bets are off

options chain guessing 235-265ish

if P&D is bad, we'll probably touch low 240's next week

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My gosh, thank goodness we have a three day weekend!..

and I thought I built models - whew.. nice work.

While JOLTS has been one of my favorite, while overlooked economic reports for the past ~ 20 years, I think today it’s less relevant than other household or BLS data, weekly or monthly. Secretary Yellen loves it, but I think it truly overlooks the true demand/supply function of labor, and more indicates the type of demand vs. type and LOCATION of supply imbalance for the current state of the labor economy.

 

[EVNow]

All week long, everyone was sure about MM defending the 250 call wall and tall 250 gamma wall but both failed.

This was posted on 16th. You can say the same thing for yesterday !