Wiki Selling TSLA Options - Be the House

[thenewguy1979]

This dog see big potential this year. Going be volatile. Not as big as when Max was describing but potential to make big bucks.

1000 for a million vs 300000 for 1000…still making money right

Me just need something in between…

Edit - dont be too optimistic and dont be too pessemistic - just trade in between, or as wise dog always said - go where the kibbles flowed

 

[tivoboy]

this is the 11th week where 7DTE is below +/- 10% OTM (range -5% to +9%)

View attachment 1006708

in dollar terms, that's -11 to +20 week over week

View attachment 1006707

Patterns is patterns,

till they are not.

Is this an eye chart for anyone else… it all just looks blurry until zoomed in.. maybe that is a metaphor.

 

[EVNow]

it's not sustainable by law of averages, we're overdue for a rip (up or down)

perhaps Earnings Week is the trigger

(edit): my takeaways - laddering into positions is more important than ever, and probably 4DTE is better than 7DTE for now

View attachment 1006758

After important events, IV goes down. So after P&D (and I guess Santa rally), IV is down. Will jump up for ER and then collapse again.

 

[EVNow]

Thought of a quick Granger causality test to run on this data, FYI.

A couple of conclusions:

1. The SP is a greater predictor of the next max pain than max pain is a predictor of the next SP (the correlation we see is likely to be a reverse-causal relationship).
2. The relationship between the difference of the SP and max pain and the next movement in the SP is not large or statistically significant. In this dataset, every $1 difference between the SP and max pain changed the SP in the direction of the difference by about $0.02 the following trading day.

How about running the test online Fridays?

Traders change the strikes based on SP (we all do !). So, it makes a lot of sense that SP affects max pain.

 

[Yoona]

Note to self: Last week I closed a position by not sticking to the plan. Much of it had to do with some time I needed for myself and family, no time to watch the ticker. Clearly, the spread was quite safe and as pointed out by several others, silly to have closed it at what I opened it when I could have clearly rolled it. Oh well, nothing earned, nothing lost.

20 yrs of backtesting (running the tests for 8 hrs) concluded that doing nothing oftentimes is better than managing losing ICs too early

i experienced that last Fri when my -p235 was -249% underwater in the morning with 80% Probability of Touch, which happened when we temporarily sank to 234.90 and got up again; i did not panic since I could roll it to -p225 with credit and planned to roll before 3pm (that's when my broker starts calling).

this experience leads me to think i should open 40-wide spreads instead of 30 (ie -p220/+p180) for risk management purposes; this gives me better rolling choices and more beauty sleep

 

[willow_hiller]

How about running the test online Fridays?

Traders change the strikes based on SP (we all do !). So, it makes a lot of sense that SP affects max pain.

Parsed your question as subsetting the data just to Thursdays, so we're only seeing whether the Thursday max pain predicts the Friday close, or the Thursday SP predicts the Friday max pain. Let me know if you had something else in mind.

It's much closer, but by a hair the SP is still a better predictor of the future max pain. And it actually reversed the sign on dollar change. Every $1 difference between the max pain and the SP on a Thursday leads to, on average, a -$0.01 change in the SP by Friday close (but again, very much not significant).

 

[Jim Holder]

Welcome to the TSLA Carnival

ON TODAY: See the magical-never-ending-ever-extending wedge!

Another week and yet another chart with the wedge extended again to the right with the caption “TSLA COILED!”

Soon we’ll be in 2025 and looking at the same wedge.

 

[Arul]

A few musings about what I find guides my trades based on my experimenting:

1) Laddering! Big time helpful to me. 10-15 CC contracts at a time at local daily pops, most often during opening 15 minutes (this past summer/fall this pattern of pop/fade was exceptionally reliable). And closing when I see decent green. It annoys me to see green disappear as SP recovers. While I definitely leave money on the table during times when SP keeps going down further, I’m pulling in gains consistently while also removing risk by closing the CCs (!) and by watching the SP movement I gain the freedom of choosing new better, sometimes higher strikes (and often higher premiums on the same CCs I already closed) based on the data the unfolding day and week presents (this edge is underrated IMO). I haven’t needed to roll much if at all in months. I don’t know if this means I am too risk-adverse or just lucky. The money is good so I don’t really care

2) I choose strikes/DTE not more than 0.10-0.13 delta +TA UNLESS I expect a TA/EW dump between now and expiration (thanks @dl003) then I’ll chance even 0.20-0.30 +TA (like -C300 3/2024, expecting a dump in or around Feb, but likely not exceeding $300 anyway if not and time to fix if yes). Always prepared to roll up and out if surprised. And since I’ve laddered, only some will be in peril. The rest I can close for whatever gains they have, big or small. Yes, this means sometimes what I got $1.50 for I could have gotten $8.00 had I sold later after a major pop, but that doesn’t happen very often and meanwhile the consistency of income wins out for me.

3) I only choose strikes I’m okay my shares getting called away at (I have a tranche at $298 CB and a tranche at $358 CB). I take a bit more chances on closer DTE (7-10 days) when I have higher conviction that SP won’t exceed a certain level (like $270 recently).

4) I remain hyper-aware of the waves and trends, so when we finish a run, congest, and come off highs (like $265 recently), I give myself permission to become a bit more aggressive in selling more contracts and choosing closer strikes when selling CC’s. Same for the inverse, when we carve out a seeming low (like $235 now) I’m more careful and go higher out on strikes and increase short puts. If I mess up and can’t roll for credit I just rebuy or sell the shares that get called away or put to me, hopefully with not too much damage.

5) I don’t have the guts or nerves yet to sell ITM+near expiry CCs (and never -P) and do so only on rare occasions, like when we approached $300 I sold a ton of CC’s for $310 and with the high IV then it was a great sale. I was okay to let the shares go at that price, and was even more thrilled too when it never hit and I kept the shares and the premium. @dl003 does this well and I hope to learn more and try this over time as my trend-spotting gets better.

6) Like a pot of hearty soup always on the stove in the winter, in addition to my weekly scalps I always have on decent-sized exposure for large sudden swings up (-P LEAPS) and down (-C LEAPS), leaning heavier on each side depending where we are, a trough or top. I like LEAPS since they offer time to fix things if I made a bad choice and they move quite strongly on wide SP movement too. While I used to use far out LEAPS for these (2025/2026), @Max Plaid taught me the value of having some closer-dated LEAPS (like September 2024) which open up rolling opportunities and I add some closer in like this as well to great effect.

I’m still learning and experimenting and I’m sure there’s more I can add to the above. And I’m really no expert. Credit really goes to the team here and really @MikeC who taught me how to extricate myself from a mess I made in June 2023 and I’ve been building on the foundations I’ve learned from him during that debacle, and the great ongoing education here from @Max Plaid and @dl003 and the rest of you.

Bottom line for me is the extreme importance of effective risk-management and keeping greed and impatience in check as it underpins the success of any strategy.

Good ideas and how do you do laddering ?

 

[Arul]

Sunday morning blah blah blah... Regarding @dl003 and @BornToFly discussion on "bullishness"...

I can only speak for myself, but I suspect this holds true for some others too. The total sum of money I've ever put into my portfolio is around $120k, started in 2015 with 8 $TSLA shares, then added 400 in Feb 2016, which was the main investment, and after that bought a handful whenever I could up until mid 2019 - the split-adjusted cost-basis was something like $14 and I had around 600 shares before it all kicked-off

I didn't dare sell calls against my shares as I was terrified of losing them, but I did occasionally buy some weeklies, almost always losing my money

Then September 2019 I bought some low priced LEAPS - I didn't really know what I was doing TBH, but they were crazy low-priced, and started trading options seriously in 2020. I was lucky, the LEAPS went up fast, I rolled them further out to higher strikes, more contracts, they went up even more, it just didn't seem to stop, in the Feb 2020 crash ($900 -> $300 in a few weeks) I again bought a load of LEAPS at the bottom, which doubled in days, had I held them to expiry though, I would have been retired long ago, it was absolutely crazy times to get rich

So from the $120k starting point my account was $5.3million when we hit ATH in November 2021, that's pretty insane, I actually turned $1000 into $1.3million, yes, it happened, people think this is impossible, but it can be done, but it wasn't because I'm a trading genius - although at the time I though this was the case, obviously - but rather the stars just aligned, sure I was doing the trades and making decisions, but you could hardly do nothing wrong at that time, the main credit I would give myself is that I took some risk, where others did not, and it paid off

My point of writing all this is to say that I'd had zero previous experience of the markets, so my outlook and decisions have been totally coloured by that initial experience, TSLA "always goes up", @dl003 is 100% correct in this

Now a lot of folks, less here, but certainly in the "other" thread, are totally convinced that TSLA will do another crazy run in the future. Personally I don't see it happening. The events from 2016 to 2021 were unique IMO, a perfect storm, highly unlikely to happen again: low interest rates, FED printing money, years of TSLA being suppressed by the oil industry FUDsters, the first 5 for 1 split, the S&P inclusion, etc.

But it has taken me years to change my mind-set from where were were to now accepting that the stock price likely isn't going to 2x this year, why would it, what could possibly cause that, I don't think anything, even FSD being "solved" won't change much short term. Tesla is already at a high valuation implying a lot of future growth and perfect execution

But I do still think the company will become the most valuable, just that it will be a more measured rise from here, with a few roller-coaster rides from time to time, hence I'm looking to build my TSLA position back up to 10k shares

Great storey,just reminds me my journey too. still i am not an expert but when you made 5 million i made 6 million. unfortunately 2022 viped everthing to just 2 million. i think the dealing with puts and using the margin is my explanation as i said i am not an expert. Now i use very little margin. I have 6000 shares and try to build to 10,000, its not working. In 2023 I had a good year with my options and increased my shares. But timing the market is difficult. 2020 i bought leaps without knowing anything lost over $100,000. I use to bet all my shares on CC in two IRA and one trading accout and was bringing good money. Then i think around last June all my shares were called away and I had to start all over again.Now I do CC only about 25-30% of my portfolio. This week I hardly did anyCC because of the uncertaity of the directions. My only rule now is Yoonas idea. wait for the days peak or resistance and sell OTM CC against them. It works weel for me in 2023. As you said its part luck.

 

[DaBooster]

Good ideas and how do you do laddering ?

 

[SpeedyEddy]

Welcome to the TSLA Carnival

ON TODAY: See the magical-never-ending-ever-extending wedge!

Another week and yet another chart with the wedge extended again to the right with the caption “TSLA COILED!”

Soon we’ll be in 2025 and looking at the same wedge.



View attachment 1006986

Of course we will leave the wedge. If you stretch it (other than you did) to the max, so under all the lows and over all the highs, we could end at (indeed) 2025/04/30 but at SP $167.

 

[Yoona]

calling all IT geniuses...

the good news is, i have maxpain raw data 2021-2023

the bad news is, i am sure they are good but i need eyeball verification and the only source i can think of is Papafox

does anyone know how to scrape text pages from TMC? (pages 165-207 of his thread)

or point me where/how to do it

for ex: on Jul 16, 2021, he said "With Max pain sitting at 650 and TSLA closing at 650.60, we have the setup for "

that's all the filter i need: Date + all lines containing "Max Pain" or "maxpain"

i don’t need images

or dump me all text and i will filter

he doesn't mention max pain on every post, and that's ok

TIA!

 

[Nocturnal]

Welcome to the TSLA Carnival

ON TODAY: See the magical-never-ending-ever-extending wedge!

Another week and yet another chart with the wedge extended again to the right with the caption “TSLA COILED!”

Soon we’ll be in 2025 and looking at the same wedge.



View attachment 1006986

Remember the Cybertruck crash test teaser video where the footage cut away right before impact every time?

This.

 

[SpeedyEddy]

calling all IT geniuses...

the good news is, i have maxpain raw data 2021-2023
View attachment 1007068

the bad news is, i am sure they are good but i need eyeball verification and the only source i can think of is Papafox

does anyone know how to scrape text pages from TMC? (pages 165-207 of his thread)

or point me where/how to do it

for ex: on Jul 16, 2021, he said "With Max pain sitting at 650 and TSLA closing at 650.60, we have the setup for "

that's all the filter i need: Date + all lines containing "Max Pain" or "maxpain"

i don’t need images

or dump me all text and i will filter

he doesn't mention max pain on every post, and that's ok

TIA!

I am working in this via search function, give me 10 minutes. Rest of y'all can leave it to me for this moment!

 

[elasalle]

thoughts ..
say you open two short vertical spreads $20 wide, and with laddering. e.g. [-C 300, + C320], [-C340, + C 360],(numbers made up) having done your home work you think it will never hit 300, but in next few days, SP goes up. At that time, you close +C320, -C340 as if it was a long spread, you make some profit on this, and then you are left with just -C300, +C360 with a bigger spread to tend to and wait for theta decay ..

I did this on a recent non TSLA position, and am waiting till Jan 26th for full results.

 

[SpeedyEddy]

@Yoona ready, Date is below every posting! (NOT all max-pain data included, but I hope enough to validate what you've got already)

 

[Yoona]

@Yoona ready,

WOW THANK YOUUUUUUUUU

 

[intelligator]

thoughts ..
say you open two short vertical spreads $20 wide, and with laddering. e.g. [-C 300, + C320], [-C340, + C 360],(numbers made up) having done your home work you think it will never hit 300, but in next few days, SP goes up. At that time, you close +C320, -C340 as if it was a long spread, you make some profit on this, and then you are left with just -C300, +C360 with a bigger spread to tend to and wait for theta decay ..

I did this on a recent non TSLA position, and am waiting till Jan 26th for full results.

To ladder in , would the second short spread at -c340 be opened as SP approaches 300 or at the same time? Oh, reading what I wrote, would harvesting some profit from the long spread be best if the two opened at same time?

 

[elasalle]

To ladder in , would the second short spread at -c340 be opened as SP approaches 300 or at the same time? Oh, reading what I wrote, would harvesting some profit from the long spread be best if the two opened at same time?

mine were done same time, and profits on the inner proxy long spread will be there as all done on same time, else some timing would have to be factored in to get the desired results

 

[jim0266]

Pretty impressive job keeping TSLA down with SPY, QQQ ripping this morning.