Don't worry, once it's 60 people will say 20, and when it's 20 people will say 10. When it's 0 people will say -10. Didn't people sold calls here at 120 dollar strike price waiting to close them at 80?
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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Of course. That this is likely not over until TSLA has a $12xx in front of it. I just sought to understand your process for acquiring shares at an exact level which may or may not hit. You explained it well a couple posts up
Yes, worth noting that it's a strong macro day today, with SPY and QQQ up 0.8%, VIX down 10%
And yet TSLA down 3.5%
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-p130 sirens keep calling my name, must resist! (at least until tomorrow...)
I’m afraid you are mistaken. I started to doubt myself, but one of the perks of being a mod is that I can see all versions of a post. The dates were already in the first version. But all is good.
The 3rd leg of this potential falling wedge is $45.45 in length, vs the 2nd leg @ $45.09. This is not ideal but imo still within an acceptable margin of error, 36 cent longer than it's supposed to be. Still I added some more hedges around 142 today & roll my -140P's down to -128P's, using all the premium collected on the initial sale. If tomorrow we don't gap down, then it's up to Elon. If we gap down then that will invalidate this falling wedge.
Expected move post ER is 130 - 153.
Expected move post ER is 130 - 153.
I almost pulled the trigger on a protective spread. Was thinking about May 3rd -130/+140 for $3.5. Might still do it tomorrow on a bounce. But how is the apocalypse not priced in at this point?!?
(We are very oversold on 1hr and 2hr RSI. Also below BB for 6 days, which on a glance of the chart as far back as 2019 has never happened before.)
(We are very oversold on 1hr and 2hr RSI. Also below BB for 6 days, which on a glance of the chart as far back as 2019 has never happened before.)
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i suspect this is just DCB
smart money pumped and got their fib: those who were caught flat-footed last fri can now exit with profit
they may rug pull if 50sma doesn't hold... the last hr of the day is usually smart money prepping for next day
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ProfessorZoom
Member
Thank you.
What would be a reasonable spot for CCs for say 5/17 (to leave maneuvering space) since even if we somehow get to $153 it’ll likely bounce around a bit and it may take time to stretch any higher.
i closed today's position, net 1450 per contract
round 2 tom at MMD, probably a bit more ITM (not advice)
i can't believe i've been playing with spreads (because of greed), when this is less risky
In case we've seen the bottom, it's not wise to sell 5/17 CCs. 4/26 165+ leaves room for a huge squeeze & retest. If you're of the opinion we're going to crash then sell any CC you want.
I know that it doesn't emotionally feel the same as a CSP (cash secured put), but a buy-write is identical to a CSP. The only difference due to margin is if you're using margin to buy the shares in the buy-write. If you have 100% of the cash to back a put, or 100% of the cash to buy the shares, then the buy-write and the CSP are identical in how they perform.i closed today's position, net 1450 per contract
round 2 tom at MMD, probably a bit more ITM (not advice)
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i can't believe i've been playing with spreads (because of greed), when this is less risky
The difference is in the emotions around the position (and tax handling in the US, where wash sale rules can pop up a lot easier with buy-writes than with CSP).
If you like the buy-shares-700 / sell 695 covering call, then you also like selling the 695 CSP, from a risk/reward perspective.
What I found was that emotionally I LOVE the buy-write. I particularly love buying the shares at a price I'm happy to buy at, and then selling an ITM call to go with them. I also really like that holding that call down to the end or even letting it expire is emotionally trivial to do. At all prices above 695 (in this example) the position earns max profit of 73-5 - $68 (buy shares 700, sell 695 call for 73, sell shares for 695 = net 68).
At all prices below 695 the position earns the whole premium (73) and leaves you with shares purchased for $700 (and the corresponding unrealized loss, that is $5 higher due to the strike starting $5 below the share purchase price).
Anyway - I personally love buy-writes, and I think its for the identical reason you like them so much. However I think its important to be clear eyed about them having the identical risk/reward profile as selling a cash secured put. If one is a bad position, so is the other.
In particular if you think that the risk/reward for a 695 CSP (again using this example) is bad, but the risk reward for the buy-write as described here is good, then I encourage you to revisit your understanding of the position. There are no margin implications that aren't equally inherent in the other version of this position. What does the position look like at the end for various stock prices. What does it look like along the way - stuff like that. It really is the same thing.
With the CC:
Shares below 695 at expiration - you have 100 shares per contract with that you bought for 700 while fully earning the $73 call credit. Effective share purchase price is 700-73 but it looks like buy 700, unrealized loss of 700-share price on those shares, and $73 earned credit.
Or shares above 695 at expiration - you realize the max gain of shares purchased at 700, sold at 695, and a realized credit of $73 for a net realized profit of $68.
With the 695 CSP, opening credit really really close to 68.65. Shares above 695 at expiration, max gain of 68.65.
Shares below 695 at expiration, you have 100 shares with a purchase price of 695-68 = 627. You HAVE been able to postpone when the credit from the put will turn into a taxable gain as the assignment on the put contract modifies the purchase price of the shares rather than turning into a realized gain or loss.
The two kinds of positions in this particular regard - that's in the context of US tax handling. I assume Canada is similar, but I am not only not a tax pro, I'm also not a Canadian OR a Canadian Tax pro. My opinion needs some upgrading to achieve worthless
As a CSP that 695 put will have been priced really, really close to $68.65 (because if it wasn't the arbitrageurs would have been doing buy-writes or some other construct in order to collect that mispriced option and bring it back to the correct relationship).
Thanks. My question was how far can the rubber band stretch up before coming back down. You are very good with estimating those, like last time you said “sell CCs above $209 since SP will have a hard time breaking $x”. That’s the number I was looking for in my question.
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