Looking to sell 7 the -cc AUG $210 @ $10.5
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Wiki Selling TSLA Options - Be the House
- Thread starter adiggs
- Start date
Unusual Tesla Put Options Activity Today Highlights Investors' Concerns About TSLA Stock
Jun 26, 202413:00 EDTHeavy activity today in Tesla Inc (TSLA) put options that expire in two days serve to highlight investors' concerns about the stock. The strike price is right at the money. Some investors may be betting the stock will fall in two days.
TSLA is trading at $192.65 today, up $5.35 or over +2.8% higher. But the strike price for the heavy TSLA put options activity is at $192.50 for puts that expire on Friday, June 28. That means that the investor activity in these puts is for a strike price that is “at-the-money.”
It implies that some large investors believe the stock could fall over the next two days. That is why these investors are willing to pay $3.05 in the midprice for these puts.
This can be seen in Barchart's Unusual Stock Options Activity Report today. It shows that over 28,000 TSLA put contracts have been traded at the $192.50 strike price. That represents almost 49 times the normal outstanding number of contracts at that strike price.
Shorting TSLA Puts
On the other hand, other investors are willing to sell these puts to the bearish buyers of the puts. They collect that $305 in income per contract, but have to secure $192.50 x 100, or $19,250 per contract shorted with their brokerage firm. That still works out to an immediate yield of 1.558% over two days of risk.
Moreover, their breakeven cost will be just $192.50-$3.00, or $189.50 per share. That provides good downside protection of 1.635% from today's spot price.
In addition, if the investor can repeat this play every week or so, it turns out to be a great way to make extra income. For example, the expected return (ER) over 4 weeks would be 1.558% x 4, or 6.22% per month.
That assumes that the stock always ends up out-of-the-money (OTM) and that the investor does not have to buy shares in TSLA at the strike price where the puts were shorted. Sometimes that will occur, especially if the puts are shorted at the money as in this example.
That is why investors should only do this strategy if they are willing to buy shares in the shorted stock. They must be willing to hold on to those shares or even incur an unrealized capital loss.
TSLA Stock Treading Water
TSLA stock has been treading water lately. It has traded below $200 for the past 3 months and has only recently been rising again. The company's revenue fell 13% Y/Y in Q1 and its operating profitability was down 56% Y/Y.
This is seen by investors due to a slowing in demand for EVs across the world. That could prove to be difficult for the company if this slowing demand keeps up. As a result, the stock is well off of its highs, although recently it has been rising.
Perhaps investors are feeling more positive about the company's prospects going forward. Either way, the huge increase in investor activity in its at the money puts shows that investors' concerns are still very high.
thenewguy1979
"The" Dog
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I have both iphone and android apps, options is still there… search for a stock, go to “overview”, options (new) should show up. It’s also under stocks that one has in an account, but under the OVERVIEW top header
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Next week equally bullish with Trifecta Gamma/Vanna/Delta green:
7/5
7/5
Yeah, 8.16.. Aug monthlies.Had an early drink?
Is that 8/16?
You think I’m cray cray? Too close to the edge? We gonna moon next Tuesday? Is it up and over $225 and never heading back this year or ever?
Inquiring minds want to know. ;-)
Looking for not advice. For starters, I'm ok dumping the rest of my shares at 200. I currently have everything tied up in 7/19 monthly calls @ 200. I realized today that I can kick them out another month to 8/16 and profit $6 on the roll. It's a good pay day for the month.
Do I...
A. Do nothing.
B. Roll now to get that sweet cash in hand.
C. Wait as it would be more profitable to wait until....
c1. The stock is closer to 200.
c2. The stock is over 200.
c3. The date is closer to expiration.
Thank you! M3P gets delivered tomorrow. Oh yeahhhhh [Kool-Aid Man voice]
Do I...
A. Do nothing.
B. Roll now to get that sweet cash in hand.
C. Wait as it would be more profitable to wait until....
c1. The stock is closer to 200.
c2. The stock is over 200.
c3. The date is closer to expiration.
Thank you! M3P gets delivered tomorrow. Oh yeahhhhh [Kool-Aid Man voice]
@MikeC @Max Plaid I have 15x -P300 6/18/26 that are about $2-3 dollars away from where I sold them (sold for $115.75, now $118.50, the closest it's been in a looong time). I'm thinking to buy back some--or all--with the intention to sell them again on any retrace down, the lower the better.
But I'm concerned the rally can continue given TSLA has taken out 191 and 194 and seems to be holding. The higher TSLA goes, the cheaper the puts are to buy back. Originally they were sold to save the 9/20/24 -P220's that were getting close to '0' extrinsic @ $140's. It was a rolldown and out thing.
Any thoughts?
I know TSLA hasn't been able to hold its gains lately, but...maybe....this....time...is....
But I'm concerned the rally can continue given TSLA has taken out 191 and 194 and seems to be holding. The higher TSLA goes, the cheaper the puts are to buy back. Originally they were sold to save the 9/20/24 -P220's that were getting close to '0' extrinsic @ $140's. It was a rolldown and out thing.
Any thoughts?
I know TSLA hasn't been able to hold its gains lately, but...maybe....this....time...is....
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Lol. Was just referring to the way you wrote it: "Looking to sell 7 the -cc AUG $210 @ $10.5"
Had to read a few times to see what you were saying ;- )
a new M3P - you'll have to report back how much better you think it is compared to your current M3P
keeping it on topic - if you wait and let the theta drain, can roll later (or roll higher to get more for the shares) IMO, NFA etc
I guess it comes down to how high will TSLA go... My gut says TSLA will be under $200 7/18, but 8/16 is less predictable.
Yeah. I guess my actual concern is the stock drops to $150 or something when my current option expires and then I can't or don't want to sell calls that low.
Ah, next time I’ll be more clear.. maybe something like.
“Looking sell maybe calls, somewhere not sure or price”… then looking follow it up with maybe 2-3 finger Laphroaig.
;-0
thenewguy1979
"The" Dog
Ay Caramba Chihuahua
Feeling hurts....I get it I'm ugly.
Meanwhile, TSLA is steamrolling. 4hrs timeframes hitting oversold.
I don’t know where we go from here. Q2 is a big wild card to me but it’s seeming like we’ve weathered the worst of this dip with deliveries trending up from Q1 and then the Robotaxi event coming.
If you roll back to 9/20 now you’re in a worse position than if you hadn’t rolled. If your cash/margin situation is comfortable, I think it’s fine to just keep holding.
That being said, you could close 1 or 2 just to hedge and have some flexibility if we did drop. Or even flip some to calls after this little run we’ve had.
Thank you. Good idea. I BTC 5 of the 15 and STO some -C220 8/16.
Rug pull WAY more likely this quarter than last IMO. Near 200 is where we can drop way bigger than at 160s.See a lots of posting on this forum lately on how analysts are expecting some "decent" PD numbers or TSLA being more then a Car Companies affecting the grid, RT, etc......
Not sure if we are being setup for a big ass rug pull like last December.
But it seem everyone and their moms are going Long and that great post from BMD00.....
Do not yet see any substance to this pump....so going to thread carefully.
Dog dont want to be roadkill being run over forward or reverse
The substance for this pump is @dl003 induced!
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