Wiki Selling TSLA Options - Be the House (2025 edition)

adiggs · Apr 162020

I decided to create this thread as a more focused variation of the Option Trading and Advice threadwith that focus on the option strategy known as The Wheel.

The thing to understand up front - I'm not a financial advisornor am I particularly expert in options trading. So far my experience is almost completely in the options selling side. My forays into option buying either ended in large lossesor are currently losing (index puts). But the option selling has worked great for me!

My first and strongest recommendation - if you're new to options tradingor haven't studied it systematicallythen I commend the training here:
Free Options Trading Course from Option Alpha | Option Alpha

This took me about 30 hours to go through all of it (1.25x speed worked great for me). And I urge you not to skimp.

This is both general option trading educationalong with education about a particular option trading strategy (selling volatility). You're going through that material for the general educationand you'll pick up information about that particular strategy at the same time (it happens to make use of the same edge in the market as The Wheel).

From here onI'm assuming the level of knowledge conveyed in that linked education.

Here's a link to the FAQ / Glossary thread.

Max Plaid · Jan 12025

StarFoxisDown! said:
I really do not get why the election results rally is that hard to understand.

By far the thing Wall St values the most for TSLA was autonomy and the one thing that could completely derail FSD for TSLA is government overreach. It’s been clear over the past 4 years that the Biden administration through government agencies has targeted Tesla. If you do not believe that well I don’t know what to tell you.

But clearly the market viewed government overreach and the administration as major headwinds and risks for Tesla. Not only was that risk removed but a new administration is coming in that will likely make things as easy as possible for Tesla.

So if the thing you value the most has a major risk not only removed but turned into a positive catalystthen that will change your valuation of the company. So maybe the question isn’t “Was the election worth 200 in share price ?” and instead is “Was the risks to FSD taking out 200 in share price value by the market?”

Because there is no government over-reach on FSD right nowby-and-large there are no rules at all for many states. What indeed is missing is a Federal framework to align the rules across all stateswhich would indeed simplify longer term adoptiontruealthough you could also argue that's government over-reach

As stated many timesTesla could start an RT operation in many states and/or cities where there's almost zero hurdlesbut they haven'twhy? Because FSD is nowhere near ready yet99% is not good enough99.9% probably not eitherthis thing has to work all the time and it doesn't

The only other concrete thing potentially coming is for the NHTSA to relax or even remove the L2 and above crash reporting requirement. I personally view this as a negativethree monkeys speak/see/hear no evil approach will not accelerate RT adoptionbut rather increase resistance from the general public who do not trust self-driving vehiclespretending it's better than it is is not a solution IMO

Jim Holder · Jan 12025

New thread for 2025 must start with thisright?

Oil4AsphaultOnly · Jan 12025

Just in case there are any new posterslinking back to adigg's first post in the first page of the old thread: Wiki - Selling TSLA Options - Be the House (2020-2024)

Ex-mod: good ideaI actually copied it over so it's the first post in this thread too. --ggr

Jim Holder · Jan 12025

Intentional sabotage?

https://twitter.com/x/status/1874509701196693578

Jim Holder · Jan 12025

https://twitter.com/x/status/1874494574573576682

Jim Holder · Jan 12025

https://twitter.com/x/status/1874502066061869086

mongo · Jan 12025

Jim Holder said:
Intentional sabotage?

https://twitter.com/x/status/1874509701196693578

Sounds like fireworks
Note no flames from under the vehicleindicating interior sourced firenot pack

Oil4AsphaultOnly · Jan 12025

Jim Holder said:
Intentional sabotage?

https://twitter.com/x/status/1874509701196693578

Definitely sabotage. The flames are going full blast from within the passenger cellinstead of outside. Seems a CT owner had an ax to grind.

StarFoxisDown! · Jan 12025

Max Plaid said:
Because there is no government over-reach on FSD right nowby-and-large there are no rules at all for many states. What indeed is missing is a Federal framework to align the rules across all stateswhich would indeed simplify longer term adoptiontruealthough you could also argue that's government over-reach

As stated many timesTesla could start an RT operation in many states and/or cities where there's almost zero hurdlesbut they haven'twhy? Because FSD is nowhere near ready yet99% is not good enough99.9% probably not eitherthis thing has to work all the time and it doesn't

The only other concrete thing potentially coming is for the NHTSA to relax or even remove the L2 and above crash reporting requirement. I personally view this as a negativethree monkeys speak/see/hear no evil approach will not accelerate RT adoptionbut rather increase resistance from the general public who do not trust self-driving vehiclespretending it's better than it is is not a solution IMO

Nowhere in my post did I mention FSD being ready or not being ready for unsupervised. You didn’t actually address any of what I was saying.

What I was pointing out was that even though federal regulation on autonomy doesn’t exist or have overreach todaythere was a clear fear/risk that in the future with a heavy handed administrationFSD could be delayed or halted indefinitely by a administration that wasn’t favorable to Tesla or Elon. And the dynamic around that fear/risk flipped completely opposite from headwind to tailwind with the election results.

The best comparison I have for autonomy and how it’s being valued is to compare it to pharmaceutical drug/vaccine trials. In Stage 1there’s a crowded group of candidates with potential. The requirements to move from stage 1 to stage 2 is relatively easy and the viability of the drug/vaccine doesn’t have to super clear. Which is why you hardly ever see that much valuation applied to a candidate that in it’s Stage 1 trials or even passed Stage 1 requirements

But as drug/vaccine candidates goes into Stage 2 trialsthe efficacy requirements and the actual viability of the candidate to do what it’s intended purpose is increase a lot. The candidates that successfully go through the Stage 2 trials usually get at least half of their total valuation applied then…even though it can be 1-3 years for Stage 3 trials to be conducted and succeed.

IMO we’ve seen the market determine who they think has made it into stage 2 trials for autonomy and from that large list of potentials 2-4 years agoTesla and Waymo are the only ones left. You may not agree with itbut Wall St has clearly seen enough to think Tesla has passed Stage 2 in terms of viability and effectiveness. It doesn’t have to be perfect. It doesn’t have to work perfectly in every location. That’s what Stage 3 is for. But those thinking that FSD has to hit Stage 3 requirements in order to have valuation applied to it are going to miss out on at least half of the value appreciation. In fact they’ve already missed out on a lot of value appreciation already.

Jim Holder · Jan 12025

https://twitter.com/x/status/1874513685823324427

intelligator · Jan 12025

With TSLA SP trending downI have 5x Jan '27 -c500 to reel in. The cost basis of the just about even roll is 37.59 SP would have to hit 245 to be back to roll pricing. Initially I was okay having shares called away at $240 cost basis of the shares are $212I've earned $20 per share by selling CC and buying back before expirefive rounds.

The aim is to keep the shares. What's a good approach to rescuing these without a debit?

StarFoxisDown! · Jan 12025

intelligator said:
With TSLA SP trending downI have 5x Jan '27 -c500 to reel in. The cost basis of the just about even roll is 37.59 SP would have to hit 245 to be back to roll pricing. Initially I was okay having shares called away at $240 cost basis of the shares are $212I've earned $20 per share by selling CC and buying back before expirefive rounds.

The aim is to keep the shares. What's a good approach to rescuing these without a debit?

Just wait and do nothing?

The stock is likely going to chop anywhere from mid 300’s to low 500’s depending on catalystboth positive and negative. So the shares won’t be called away anytime soon. Just wait for June 27 or Jan 28 options to start trading

thenewguy1979 · Jan 12025

Oil4AsphaultOnly said:
Definitely sabotage. The flames are going full blast from within the passenger cellinstead of outside. Seems a CT owner had an ax to grind.

Cybertruck catches fire at DeKalb County Tesla dealership

A Tesla Cybertruck went up in flames overnight in DeKalb County.

decaturish.com

intelligator · Jan 12025

StarFoxisDown! said:
Just wait and do nothing?

The stock is likely going to chop anywhere from mid 300’s to low 500’s depending on catalystboth positive and negative. So the shares won’t be called away anytime soon. Just wait for June 27 or Jan 28 options to start trading

That too. Letting them sitthe shares are locked and aren't earning anything. I'd like put the shares to good usegenerate cash writing ATM calls.

Max Plaid · Jan 12025

StarFoxisDown! said:
Nowhere in my post did I mention FSD being ready or not being ready for unsupervised. You didn’t actually address any of what I was saying.

What I was pointing out was that even though federal regulation on autonomy doesn’t exist or have overreach todaythere was a clear fear/risk that in the future with a heavy handed administrationFSD could be delayed or halted indefinitely by a administration that wasn’t favorable to Tesla or Elon. And the dynamic around that fear/risk flipped completely opposite from headwind to tailwind with the election results.

The best comparison I have for autonomy and how it’s being valued is to compare it to pharmaceutical drug/vaccine trials. In Stage 1there’s a crowded group of candidates with potential. The requirements to move from stage 1 to stage 2 is relatively easy and the viability of the drug/vaccine doesn’t have to super clear. Which is why you hardly ever see that much valuation applied to a candidate that in it’s Stage 1 trials or even passed Stage 1 requirements

But as drug/vaccine candidates goes into Stage 2 trialsthe efficacy requirements and the actual viability of the candidate to do what it’s intended purpose is increase a lot. The candidates that successfully go through the Stage 2 trials usually get at least half of their total valuation applied then…even though it can be 1-3 years for Stage 3 trials to be conducted and succeed.

IMO we’ve seen the market determine who they think has made it into stage 2 trials for autonomy and from that large list of potentials 2-4 years agoTesla and Waymo are the only ones left. You may not agree with itbut Wall St has clearly seen enough to think Tesla has passed Stage 2 in terms of viability and effectiveness. It doesn’t have to be perfect. It doesn’t have to work perfectly in every location. That’s what Stage 3 is for. But those thinking that FSD has to hit Stage 3 requirements in order to have valuation applied to it are going to miss out on at least half of the value appreciation. In fact they’ve already missed out on a lot of value appreciation already.

WellI don't agree at allbut no point arguing the same point over and overso I'll leave it there

ShareLofty · Jan 12025

intelligator said:
That too. Letting them sitthe shares are locked and aren't earning anything. I'd like put the shares to good usegenerate cash writing ATM calls.

Isn’t that the risk when you took when you wrote 2027 calls?

intelligator · Jan 12025

ShareLofty said:
Isn’t that the risk when you took when you wrote 2027 calls?

Not exactly but from your perspectiveyesthat is the risk. I rolled to '27 to keep the shares during the run-up the week of 10/25. I'd rolled week to week up to thenuntil I couldn't anymore. SP slid from 250's late September to 220s mid Octobertrading sideways a few weeks before rolling to '27. I suppose I could have let the shares get called away then; on the 24th share price was $260. Because the 10/25 -c220 were DITMcost to close them would have been just under 19k. At that time I decided to push them out with the expectation that we'd see 220-230 again ... not. Not knowing or expecting we'd double over the next two monthsI thought I was logical to do what I did.

Jim Holder · Jan 12025

https://twitter.com/x/status/1874558969802547611

thenewguy1979 · Jan 12025

1 person was killed inside the truck. Seem more like an accident.

Deadly Tesla Cybertruck blast outside Trump hotel in Las Vegas was intentionalofficials say

The suspicious blast is being investigated as a possible terrorist attackthree senior law enforcement members briefed on the matter told NBC News.

www.nbcnews.com

Wiki Selling TSLA Options - Be the House (2025 edition)

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