trading

[mrmage]

I swore off short term calls, so naturally I bought a little 250 Oct 4 calls at 1.88. Next step: Enroll in gamblers anonymous.

 

[EVNow]

IV is now about 72%. I expect it to drop to 50% after P&D.

I'm looking at calls/puts ~ $1 - for these to make money, we need a ~ $10 change in SP. If buying both puts & calls to hedge, need ~$15 SP change to break-even. Not sure we'll get that kind of SP change (esp on the upside).

 

[Antares Nebula]

IV is now about 72%. I expect it to drop to 50% after P&D.

I'm looking at calls/puts ~ $1 - for these to make money, we need a ~ $10 change in SP. If buying both puts & calls to hedge, need ~$15 SP change to break-even. Not sure we'll get that kind of SP change (esp on the upside).

I've been trading and accumulating Oct. 4 options with relatively decent success over the last week. I'm now left with 227.50 puts and 247.50, 250, 255, and 265 calls in various proportions, with much more calls than puts. This is more options than I normally hold, but I have been trading them too and with some success, so that my net outlay is not too bad. I'm fine with them all expiring worthless.

Edit: Looks like that's what will happen.

 

[bdy0627]

IV is now about 72%. I expect it to drop to 50% after P&D.

I'm looking at calls/puts ~ $1 - for these to make money, we need a ~ $10 change in SP. If buying both puts & calls to hedge, need ~$15 SP change to break-even. Not sure we'll get that kind of SP change (esp on the upside).

I would agree that it seems unlikely that we will see more than a $10 stock movement. I think the most reliable play, as is often the case, was to buy calls several days before and sell them near market close today. Of course, we didn't get that much of a climb, which made it more difficult to sell before the news.

 

[bdy0627]

Well, looks like we have our answer. Unless there is a much larger move during RTH tomorrow, premium sellers win this round (as they often do).

 

[defc0n]

With max pain at $240, I might try picking up shares tomorrow and selling on Friday.

 

[pz1975]

I would agree that it seems unlikely that we will see more than a $10 stock movement. I think the most reliable play, as is often the case, was to buy calls several days before and sell them near market close today. Of course, we didn't get that much of a climb, which made it more difficult to sell before the news.

I disagree. IMO the best move on these delivery report days and before earnings reports is to sell very OTM (8-10%) calls and puts and let them expire worthless. I have been doing that for 2 years now - easy money. I tend to sell more calls since they are covered by my shares in case there is an unexpected large run-up.

 

[Antares Nebula]

I disagree. IMO the best move on these delivery report days and before earnings reports is to sell very OTM (8-10%) calls and puts and let them expire worthless. I have been doing that for 2 years now - easy money. I tend to sell more calls since they are covered by my shares in case there is an unexpected large run-up.

I don't know the stats on the deliveries reports, but you maybe right. The earnings reports, however, have caused big moves, like Q2 2019 and Q3 2018. Option sellers would have took a bath.

 

[bdy0627]

I don't know the stats on the deliveries reports, but you maybe right. The earnings reports, however, have caused big moves, like Q2 2019 and Q3 2018. Option sellers would have took a bath.

Yeah, the black swan type events aren't rare with TSLA, so it's easy to get killed selling options even though you can make steady money most of the time. The covered call is a way to mitigate this though since in effect you just lose your shares without benefiting from the climb, but you do get to keep that modest option premium.

 

[EVNow]

I picked up some 227.5 puts and 255 calls. Hoping to sell the puts quickly tomorrow before the total IV crash to break even.

PS : Or I could wait for MMD. Would be strange if they don't try an MMD tomorrow.

 

[Antares Nebula]

I picked up some 227.5 puts and 255 calls. Hoping to sell the puts quickly tomorrow before the total IV crash to break even.

PS : Or I could wait for MMD. Would be strange if they don't try an MMD tomorrow.

I have the 227.50 puts too. Honestly, not sure what will happen tomorrow or rest of week. 230-240 close by Friday seems the most likely. But I think there is more downside risk than upside risk. I would be very surprised if it broke above 250, simply based on the AH reaction to the report. That would be a heck of a reversal. On the other hand, while it seems to have bounced off of yesterday's AH low, I wouldn't put it past the shorts to press their advantage tomorrow. Also macro risks, etc. So I may just hold my puts. I don't have a lot and only paid < $1. The minor loss vs a potential 10 point gain (if TSLA continues to drop to 210s/220s) is worth the risk IMO. My calls will of course expire worthless.

 

[defc0n]

I’ll be looking for the 10:30-11 dip pattern and I’ll probably pull the trigger if I like what I see.

 

[Antares Nebula]

I sold my 247.50 calls for 0.25 on the opening bounce. Not much, but its some pocket change I could use for lotto calls later. The 250, 255, 265 were single pennies range, so I'll just hold 'em. Never know, black swan and all. Continuing to hold 227.50 puts. Let's see what happens.

Edit: Just sold the 227.50 for $4 and bought the 222.50 for $2. Locked in my cost plus a tidy profit. So now I can just ride these down or let them expire.

 

[defc0n]

Bought 30 shares

 

[Antares Nebula]

Shorting Tesla @ 243.8

Nice call, though risky. Did you cover?

 

[EVNow]

I sold my 247.50 calls for 0.25 on the opening bounce. Not much, but its some pocket change I could use for lotto calls later. The 250, 255, 265 were single pennies range, so I'll just hold 'em. Never know, black swan and all. Continuing to hold 227.50 puts. Let's see what happens.

Edit: Just sold the 227.50 for $4 and bought the 222.50 for $2. Locked in my cost plus a tidy profit. So now I can just ride these down or let them expire.

Sold my puts ~ $4 too. Missed the $5 high mark when SP was at 225 (bounced within a minute), still covered both the call & put - and made a tidy profit. Similar to what happened after Q2 ER.

I'd say 225 is the low for now - barring news. There was a big drop of Nasdaq at 10:00 that only resulted in Tesla go below 225 momentarily.

BTW, IV went from 75% yesterday to ~60% in the first hour today. Now ~ 48%.

 

[defc0n]

Made a few bucks off what I considered a high probability bet. Don’t want to get greedy.

 

[defc0n]

Bought LTHM

 

[Curt Renz]

The estimated October 4th MaxPain for TSLA based on yesterday's closing open interest is $235, according to Opricot. The actual current MaxPain can fluctuate a bit throughout the day. Today is Friday and a day for which weekly options effectively expire at the market close, although settlement can continue into Saturday if necessary. This is not a quarterly or monthly expiration which tends to gather more interest.

TSLA on Opricot: Opricot Open Interest|Volume|Max Pain

MaxPain is the strike level considering both put and call options expiring today for which the writers (sellers) of options would likely retain the most of the premiums they had received, and the buyers would lose the most. The writers are mainly hedge funds and market makers. On the days of some options expirations they may find it worthwhile to manipulate the share price toward MaxPain for the benefit of their options positions.

 

[anthonyj]

It wants lower. Waaaaaaay too much supply at the $245 mark. So many people bagholding at $245 that they just want out. No chance of breakout without crazy news like Model Y starting production this quarter or someone like Carl Icahn loading the boat.