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trading
- Thread starter Boomer19
- Start date
adiggs
Well-Known Member
Closed these calls today (6 days later) at 4.15.
I planned to close these today or tomorrow. With the large bounces of the stock, plus going into earnings tomorrow, I decided that the amount of money on the table wasn't worth the energy this was consuming. Still made a little money, and as a dividend play, I'm quite happy with the end result, though not nearly what I was expecting.
adiggs
Well-Known Member
I realize this is incomplete, and the thinking might be helpful to others in a similar situation.
With today's share price action, my confidence these will be OTM on Friday at expiration is as close to certain as one can get. With $4 in premium left to decay, absent other factors, I would continue holding these at least another day or 2 looking for more like a $1 closing price (and immediate write of new calls).
But with earnings tomorrow, plus my decision I don't want this position open over earnings, PLUS the big swings in the underlying share price, my confidence that these options are noticeably cheaper tomorrow is much more variable. These options were $2 in the red ($7 or higher) yesterday. Another big up day ahead of earnings tomorrow (which sounds quite reasonable), and they might be red again, and I would be closing these today or tomorrow regardless.
So the possibility of these going red tomorrow against the possibility of a little bit more decay (but nowhere close to getting to $1) - I decided there wasn't enough money to be made for the mental energy these were consuming.
So take the win, wait for earnings, and get ready for the next sale.
adiggs
Well-Known Member
Closed these puts today at .20 and .42.
Bulk of the fill was at .20 - the final fill was because I wanted to stop thinking about it
. I'm out of the sold positions awaiting earnings - my bias is to be selling 5/8 puts and calls on Thursday or Friday.
i have 5 short puts for jan21 that just hit LT cap gains 1 yr holding period today,
they’re only worth about 17% of what i sold them for, so there’s not much more upside.
i think better to cover, wait for another opportunity to sell more, longer term/higher premium, on a pullback
even if we go full parabolic again, i have shares and various calls to cover that feeling of ‘missed opportunity’
that said, i’m generally weary about selling naked puts. for these, and all put sales, i make sure i have the cash to purchase shares should they get assigned. hence why i haven’t sold more than a handful of puts at a time, and at certain strikes.
put it this way, id still rather sell 200-250 strike puts instead of being greedy and selling 400-500 strike puts. it’s risky enough as it is. you don’t want to be forced to buy 500 shares at $500 or worse if you simply don’t have anywhere near the 250k required, less the premium you sold them for.
in other words i’d rather take the 20-25k by selling a strike really low 200s than taking double that and selling 450-500s. we were at 180 a year ago. we were at 380 a little over a month ago
to me, seeing 180 again means something very very terrible happened. seeing 380 again is just tesla market action.
also, don’t depend on your “buying power” / margin
if you’re concentrated in tesla like i am, and tsla goes down, your net liquidation value (equity) drops as your maintenance margin requirement rises, so you won’t have the margin to cover the cost of the assignment.
many will read this and be like, no sh!t sherlock, lol - and that’s fine...
but i’m gearing it to those that i’ve seen ask, across threads, varying questions about options.
so i’m trying to say the same thing 3-4 different ways so that as many people as possible can understand it, in the case they weren’t aware of the mechanics.
they’re only worth about 17% of what i sold them for, so there’s not much more upside.
i think better to cover, wait for another opportunity to sell more, longer term/higher premium, on a pullback
even if we go full parabolic again, i have shares and various calls to cover that feeling of ‘missed opportunity’
that said, i’m generally weary about selling naked puts. for these, and all put sales, i make sure i have the cash to purchase shares should they get assigned. hence why i haven’t sold more than a handful of puts at a time, and at certain strikes.
put it this way, id still rather sell 200-250 strike puts instead of being greedy and selling 400-500 strike puts. it’s risky enough as it is. you don’t want to be forced to buy 500 shares at $500 or worse if you simply don’t have anywhere near the 250k required, less the premium you sold them for.
in other words i’d rather take the 20-25k by selling a strike really low 200s than taking double that and selling 450-500s. we were at 180 a year ago. we were at 380 a little over a month ago
to me, seeing 180 again means something very very terrible happened. seeing 380 again is just tesla market action.
also, don’t depend on your “buying power” / margin
if you’re concentrated in tesla like i am, and tsla goes down, your net liquidation value (equity) drops as your maintenance margin requirement rises, so you won’t have the margin to cover the cost of the assignment.
many will read this and be like, no sh!t sherlock, lol - and that’s fine...
but i’m gearing it to those that i’ve seen ask, across threads, varying questions about options.
so i’m trying to say the same thing 3-4 different ways so that as many people as possible can understand it, in the case they weren’t aware of the mechanics.
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I
Just
Got
Paaaaaaid
As always, if you’ve joined me, tip the dealer. We’ll be adding a P100D model S to join our P100D Model X.
Paying. In. Cash.
Hahahahaha
Sudre
Active Member
I am loading up on PUT credit spreads for next Friday with these huge discount prices going on. I feel once this Elon hype is over people will realize how well Tesla is doing.
How about just buying 900 calls for next week exp? Would it be worth it
Sudre
Active Member
are call premiums more reasonable with the current VI?
I am still wondering how you made money on the May 15th 900 and 950 calls because I got the 950s same day and I lost a little money lol.
Leaps for me from now on. Hopefully @FrankSG will let us know if the premiums get reasonable.
I am still wondering how you made money on the May 15th 900 and 950 calls because I got the 950s same day and I lost a little money lol.
Leaps for me from now on. Hopefully @FrankSG will let us know if the premiums get reasonable.
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Sold my call today for a 200% return. Between the IV, and decay, the profit had stayed the same for the past few weeks. Even with the +60 at open, it added very little to the profit.
jeewee3000
Active Member
I added some trading shares at $780. Current SP does not reflect what we've heard in the conference call and does not reflect the upgrades today.
Didn't want to go too crazy with short term calls (IV still madness) so in case we don't recover to $900 soon I just have extra shares, but I'm quite confident I'll be able to unload these trading shares within days/weeks with a decent profit.
They're still on the expensive side, but depending on your goals, what you expect to happen, and what kind of risk/reward you're looking for, most LEAPs can theoretically have a place in a portfolio right now.
Risk/reward ratio is obviously a lot worse than it was a couple hundred dollars ago. I reckon a lot of LEAPs will still pay off, but risks are slightly higher and rewards much lower. So it really all depends on your situation and what you're looking for. It's hard to give specific advice.
Sudre
Active Member
Since I posted my Option Calls spread and Put spread idea I will let you know how it came out. Obviously we did not go in the direction I preferred. I covered the Call spread and used the Put spread so in the end I actually managed to make $300.. WOOHOO! It was still fun.
I will say after last nights strong move up I was ready to rake in some cash today. Sadly the SP had a different idea.
I will say after last nights strong move up I was ready to rake in some cash today. Sadly the SP had a different idea.
Update for @juanmedina: this worked. Limit sell order triggered early Monday. +50% looks amateurish next to @BenPrice 's results, but not bad for a fifth option trade ever
. Have to get better at it, though it was a cautious trade.Similar threads
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