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*Official* Options trading thread: Why Alpha/Beta when you can Theta?
03-09-2021, 09:47 AM
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#511
STO:
TSLA 4/16 $730C
TSLA 4/23 $725C
PLTR 4/1 $29.5C
PLTR 3/26 $29.5C
PLTR 4/9 $29C
LULU 4/16 $330C
Currently red on the TSLA calls because holy chit did it ramp up, but will remain aggressive and manage with existing shares and/or opening CSPs
TSLA 4/16 $730C
TSLA 4/23 $725C
PLTR 4/1 $29.5C
PLTR 3/26 $29.5C
PLTR 4/9 $29C
LULU 4/16 $330C
Currently red on the TSLA calls because holy chit did it ramp up, but will remain aggressive and manage with existing shares and/or opening CSPs
"It won't get better, just different."
03-09-2021, 09:12 PM
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#512
- usersignup2
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- usersignup2
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Originally Posted By chino3⏩
I saw your previous TSLA short calls and thought holy **** aggressive strikes. The 14DTE calls and longer must have been 40Delta or higher when you sold them. GL to you, hope you can manage them. Im still holding Mar19 850P deep red so unfortunately will be rooting against you so that I can get through at minimum break even which is 800ish. Long shot I know.STO:
TSLA 4/16 $730C
TSLA 4/23 $725C
PLTR 4/1 $29.5C
PLTR 3/26 $29.5C
PLTR 4/9 $29C
LULU 4/16 $330C
Currently red on the TSLA calls because holy chit did it ramp up, but will remain aggressive and manage with existing shares and/or opening CSPs
TSLA 4/16 $730C
TSLA 4/23 $725C
PLTR 4/1 $29.5C
PLTR 3/26 $29.5C
PLTR 4/9 $29C
LULU 4/16 $330C
Currently red on the TSLA calls because holy chit did it ramp up, but will remain aggressive and manage with existing shares and/or opening CSPs
03-09-2021, 09:23 PM
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#513
- usersignup2
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- usersignup2
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Premiums crap yesterday and instead of forcing a trade, took a deep breath and prayed for rain. Reprieve for a day. 'Recovered' 50K on my TSLA long positions thank god. Contemplated selling all my GOOG holdings to cover my stupid TSLA short put. Still paying the price for a bad bad trade and not managing it correctly.
Still cautious. Selling 10 and 20 Delta calls until my balls drop back down.
STO
TSLA Mar12 730C x2
TSLA Mar12 740C x2
PLTR Mar12 26.50C x10
Looking to net 2400 for the week if all goes well.
Still cautious. Selling 10 and 20 Delta calls until my balls drop back down.
STO
TSLA Mar12 730C x2
TSLA Mar12 740C x2
PLTR Mar12 26.50C x10
Looking to net 2400 for the week if all goes well.
03-12-2021, 05:56 AM
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#514
03-12-2021, 09:29 AM
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#515
Anybody thought about selling puts on low cap stocks like OCGN? The premiums are so juicy.... 7.5 strike expiring in like 35 days is like 1.5usd premium, on 10k collateral that is 2k gain in a month, those are some crazy returns
03-12-2021, 09:49 AM
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#516
Originally Posted By mikusk⏩
Problem is how quickly they can tank, but that is very tempting...Anybody thought about selling puts on low cap stocks like OCGN? The premiums are so juicy.... 7.5 strike expiring in like 35 days is like 1.5usd premium, on 10k collateral that is 2k gain in a month, those are some crazy returns
Originally Posted By TugOfPeace⏩
gjdm.So UNFI broke $40. My call is up 40%. Starting to think it would've been nice to buy like 50 calls instead of 3 for a better gain, but that's a lot of risk.
Also it seems that buying calls close to the current stock price is a short term bullish move with higher risk/profit as opposed to calls further OTM.
In the case of UNFI, the rurmor was that earnings would be good, which has already happened, so knowing that, I should've bought calls closer to ITM.
Also it seems that buying calls close to the current stock price is a short term bullish move with higher risk/profit as opposed to calls further OTM.
In the case of UNFI, the rurmor was that earnings would be good, which has already happened, so knowing that, I should've bought calls closer to ITM.
You could always look into call spreads to lessen your out of pocket, but also limits your upside.
For instance by a call for say $45, but sell a call for $46 or 50 or whatever.
Play with the strikes on OPC.com and see if something makes sense.
"It won't get better, just different."
03-12-2021, 10:03 AM
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#517
- Harry362
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- Harry362
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I have some LEAPS and long dated calls I am selling PMCC against now
3x AFRM 3/22 55c for $35 each
- able to sell May 2021 95cs for $700 each, waiting for a green day though
1x DIS 1/23 150c for $63
- sold a 4/16 220c against it for $210
1x AAPL 1/23 75c for $49
- sold a 4/16 127.5c for $235
never done PMCC before, seems like it could be a good way to ride the stock up and make some premiums along the way, theta seems minimal
I looked at a lot of tickers for this strategy and LEAP premiums seem too expensive for alot of stuff to make it worthwhile
3x AFRM 3/22 55c for $35 each
- able to sell May 2021 95cs for $700 each, waiting for a green day though
1x DIS 1/23 150c for $63
- sold a 4/16 220c against it for $210
1x AAPL 1/23 75c for $49
- sold a 4/16 127.5c for $235
never done PMCC before, seems like it could be a good way to ride the stock up and make some premiums along the way, theta seems minimal
I looked at a lot of tickers for this strategy and LEAP premiums seem too expensive for alot of stuff to make it worthwhile
03-12-2021, 10:38 AM
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#518
Originally Posted By chino3⏩
ya I would only do it if I was very bullish on that stock, but looking at the chart it seems unlikely that it would drop below 7.5Problem is how quickly they can tank, but that is very tempting...
03-12-2021, 10:47 AM
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#519
03-12-2021, 02:40 PM
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#520
- Harry362
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- Harry362
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has anyone ever bought a ****load of long dated calls and sold short dated calls against them?
Looking at UWMC December 2021(as far as it goes now)
You could buy $10 calls for $1.90
Immediately sell 12.5 calls for April for $0.55, or May for $0.80
Those are pretty good premiums on both sides, would be interesting to go really hard and buy say
BTO 100x December 10c for $19,000
STO 100x May 12.5c for $8000
If it exercises you really only paid $11.90/share so there is another $6,000 in there to be made, profit of $14,000 off of $19k in just 60 days, it likely wont exercise though so you make $8k and still have all your calls which haven't suffered much theta decay and likely wont be worth much less
UWMC has good support in the mid $7s I dont see it droppin much farther and its a good company
Delta is 53.53 so even better scenario it goes up a couple bucks and you make $5300 per dollar increase
Looking at UWMC December 2021(as far as it goes now)
You could buy $10 calls for $1.90
Immediately sell 12.5 calls for April for $0.55, or May for $0.80
Those are pretty good premiums on both sides, would be interesting to go really hard and buy say
BTO 100x December 10c for $19,000
STO 100x May 12.5c for $8000
If it exercises you really only paid $11.90/share so there is another $6,000 in there to be made, profit of $14,000 off of $19k in just 60 days, it likely wont exercise though so you make $8k and still have all your calls which haven't suffered much theta decay and likely wont be worth much less
UWMC has good support in the mid $7s I dont see it droppin much farther and its a good company
Delta is 53.53 so even better scenario it goes up a couple bucks and you make $5300 per dollar increase
03-12-2021, 03:03 PM
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#521
- roughinhouse
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- roughinhouse
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Originally Posted By TugOfPeace⏩
You want to sell as soon as the volatility spikes up and then re-enter when it drops. You'll make way more rather than holding it long term because of theta decay. For example i sold the very next day for $1.20 from $0.40. A few days later it dropped to $0.60 so i decided to buy in again. We could've made big money if we kept buying unfi calls mid-day and sell them at the beginning of the next day because they always seemed to spike in the morning and then drop severely mid-day to closeSo UNFI broke $40. My call is up 40%. Starting to think it would've been nice to buy like 50 calls instead of 3 for a better gain, but that's a lot of risk.
Also it seems that buying calls close to the current stock price is a short term bullish move with higher risk/profit as opposed to calls further OTM.
In the case of UNFI, the rurmor was that earnings would be good, which has already happened, so knowing that, I should've bought calls closer to ITM.
Also it seems that buying calls close to the current stock price is a short term bullish move with higher risk/profit as opposed to calls further OTM.
In the case of UNFI, the rurmor was that earnings would be good, which has already happened, so knowing that, I should've bought calls closer to ITM.
03-12-2021, 03:26 PM
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#522
Originally Posted By Harry362⏩
I'd be curious how your broker would view a PMCC with regard to reserved capital. Since it's not a true covered call, and you don't have PM, they might tie up funds based on all the "naked calls." Also, $10 calls with UWMC might not be a great idea, and would require a lot of management and willingness to cut losses otherwise you will risk $19k in premiums being worthless.has anyone ever bought a ****load of long dated calls and sold short dated calls against them?
In theory, it seems great, provided you:
1) don't have to have money tied up because of the calls
2) have patience and don't mind waiting months on end for a play to pan out
I actually recently thought about doing this as well, but just not sure how I'd feel waiting and waiting and waiting, especially days when those calls go BLOOD FUKKIN RED
"It won't get better, just different."
03-12-2021, 04:07 PM
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#523
03-12-2021, 05:30 PM
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#524
03-13-2021, 11:45 AM
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#525
Originally Posted By Harry362⏩
Read elsewhere that the LEAPsshouldact as if you had the shares, so no additional funds needed. I’m either going to do this with TSLA in my IRA, or go balls deep on SWBKYou could immediately make back 8k in those premiums so really only risking 11k.
Not sure how fidelity would calculate collateral
Not sure how fidelity would calculate collateral
Originally Posted By Travis99⏩
Without knowing your positions, but speaking from experience with TDA, when you have pending trades/options/etc that require reserve capital, they will put it on your margin as to not tie up cash in case you need it. It wont be subject to margin interest, so don’t trip on that.Fidelity has a horrible user interface. I don’t understand why I have a margin debit balance of 3k. Should have had funds in there to cover it.
"It won't get better, just different."
03-15-2021, 08:42 AM
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#526
- usersignup2
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- usersignup2
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Last weeks trades had to close PLTR 26.50P for a loss. My TSLA cc expired worthless. Ended week at just under 2K net.
STO
TSLA Mar19 765C x2
TSLA Mar19 805C x2
Still waiting for some small longer trades to go through. Looking to net just over 3K this week with these 2 trades.
STO
TSLA Mar19 765C x2
TSLA Mar19 805C x2
Still waiting for some small longer trades to go through. Looking to net just over 3K this week with these 2 trades.
03-15-2021, 09:45 AM
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#527
03-15-2021, 11:47 AM
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#528
Originally Posted By topperstyle⏩
interdasting first play lolJust bought my first call option to get my toes wet lolz
$3.80 UWMC $5c 12/21
Now wot
$3.80 UWMC $5c 12/21
Now wot
As for the now wot part, you have 3 options:
1) sell weekly or monthly calls against it for revenue generation
2) wait for it to increase and sell when you see a profit you like
3) wait even longer, like 9 months longer, and see what it's at at expiration and decide if you want to exercise it or not.
"It won't get better, just different."
03-15-2021, 12:42 PM
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#529
Originally Posted By topperstyle⏩
I'd recommend selling calls tbh. This is a PMCC or "poor mans covered call"Ty me
I’m just a monkey with a sharp stick when it comes to options. Just going to ease into things and see how it goes lol
I’m just a monkey with a sharp stick when it comes to options. Just going to ease into things and see how it goes lol
Originally Posted By TugOfPeace⏩
you gonna learn the hard way how untrue this isI'm liking how calls work, seems easier than holding shares
but grats on the gains
EDIT
BTC
TSLA
5/21
$760p @ $130, closed at $120
Almost guaranteed money, but my exposure is too big on TSLA (3/19 $700csp x2, 5/21 $760p x2, 1/22 $1000p x2, and also holding 200 shares). Would rather just keep it at 1 set, not including that LEAP put, and also wheel my existing shares.
"It won't get better, just different."
03-15-2021, 01:03 PM
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#530
- smashedurgfx10
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any ideas on options to sell atm?
looking at apple puts expiring 19 or 26th 121 strike for some quick cash
i dont really mind to own the stock
looking at apple puts expiring 19 or 26th 121 strike for some quick cash
i dont really mind to own the stock
Motorcycle Crew
Beard Crew
8.5/10 wife or bust crew
Deliverer of bad news crew
03-16-2021, 11:45 AM
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#531
Originally Posted By topperstyle⏩
When you have some time, check this out. Perfect for your situation, to make the absolute most of the play**** I am still figuring this whole buying/selling call stuff
https://www.youtube.com/watch?v=LmqbVg9zqjQ&t=419s
"It won't get better, just different."
03-17-2021, 09:34 AM
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#532
RBLX options started trading today. Premiums are juicy AF, but I can't go into this with how new/hyped/potentially over valued it is.
Looks like I am getting assigned a chit ton of stuff this Friday, and really don't feel like rolling them, but we'll see:
ARKF X2
ARKG
ARKQ
ARKW
LULU
And none of my CC's will get called away:
TSLA x2
LULU
PLTR
Already setup CC's for all the ARK's, LULU, PLTR, and of course still have weekly TSLA through April. Gonna try to be chill until everything settles over the weekend.
Looks like I am getting assigned a chit ton of stuff this Friday, and really don't feel like rolling them, but we'll see:
ARKF X2
ARKG
ARKQ
ARKW
LULU
And none of my CC's will get called away:
TSLA x2
LULU
PLTR
Already setup CC's for all the ARK's, LULU, PLTR, and of course still have weekly TSLA through April. Gonna try to be chill until everything settles over the weekend.
"It won't get better, just different."
03-17-2021, 12:21 PM
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#533
Originally Posted By TugOfPeace⏩
Yup, I switched to options back when I got raped on RKT. Started with selling calls, and then went full thetagang. These days I'm looking to have about 1/3 of my portfolio be long holds, and the rest freed up for wheeling.Is your strategy pretty much options these days?
I've been mulling it over and have started to wonder if I should just quit trying to hold shares and make short term profits, and instead join theta gang.Spoiler!
Mostly I've been curious about how to maximize upside while minimizing downside; for example, thought of the following:
Buy 1000 shares of PLTR @ $25
STO 4/16 10x$30C for $980 premium
STO 4/16 10x$22P for $1060 premium
BTO 4/16 10x$25P for $2480 premium.. this is where I'm a bit sketchy. This is supposed to be my hedge. I have a feeling it would be less expensive to buy weekly puts when the premiums are lower.. thoughts?
At expiration:
$20.00 - I would get $980 (CC) + $1060 (CSP) + $2520 (put) - $2000 (CSP strike vs share difference) - $5000 (shares) = $2440 loss + assignment
$22.50 - I would get $980 (CC) + $1060 (CSP) - $2500 (shares) = $460 loss
$25.00 - I would get $980 (CC) + $1060 (CSP) - $2480 (put) = $440 loss
$27.50 - I would get $980 (CC) + $1060 (CSP) - $2480 (put) + $2500 (shares) = $2060 profit
$30.00 - I would get $980 (CC) + $1060 (CSP) - $2480 (put) + $5000 (shares) = $4560 profit
So in increments of $2.50, I'm looking at the following P/L:
$20.00 - Lose $2440 + Assignment
$22.50 - Lose $460
$25.00 - Lose $440
$27.50 - Gain $2060
$30.00 - Gain $4560
This kind of trade would tie up a lot of capital however. $25,000 in shares, $25,000 for the CSP.. pretty much my entire account at this point.
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The other thing is, I was looking at the premiums for MARA.. holy moly. Feel like I should just do that instead of PLTR, but it seems like premiums are so high because it can crash any minute.
Buy 500 shares of MARA @ $38.00
STO 4/16 5x$45C for $3025 premium
STO 4/16 5x$26P for $1050 premium
BTO 4/16 5x$38P for $4100 premium
$20.00 - I would get $3025 (CC) + $1050 (CSP) + $4775 (put) - $3000 (CSP strike vs share difference) - $9000 (shares) = $3150 loss + assignment
$26.00 - I would get $3025 (CC) + $1050 (CSP) + $1900 (put) - $6000 (shares) = $25 loss + assignment
$38.00 - I would get $3025 (CC) + $1050 (CSP) - $4100 (put) = $25 loss
$41.00 - I would get $3025 (CC) + $1050 (CSP) - $4100 (put) + $1500 (shares) = $1475 profit
$45.00 - I would get $3025 (CC) + $1050 (CSP) - $4100 (put) + $3500 (shares) = $3475 profit ($25 less than just holding shares)
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The benefit I'm noticing is here:
For PLTR, if the stock price were to plummet to $20, I would normally lose $5000 just holding shares. With this strategy, I only lose $2440. If the price moons to $30, I would get $5000 with just shares, but $4560 with this strategy except I'd get that downside protection.
For MARA, if the stock price were to plummet to $20, I would normally lose $9000 just holding shares. With this strategy, I only lose $3150. If the price moons to $45, I would get $3500 with just shares, but $3475 with this strategy except I'd get that downside protection.
So if I am bullish on both, essentially I am sacrificing $440 on PLTR to save myself a potential $2560 loss, and sacrificing $25 on MARA to save myself a potential $5850 loss.Assuming of course that my strike prices are the floor and ceiling, and the stock doesn't completely go down to something ridiculous or moon ridiculously either.
For chits and giggles.. let's say PLTR and MARA both insta dropped to $10.
PLTR - I would get $980 (CC) + $1060 (CSP) + $12500 (put) - $12000 (CSP strike vs share difference) - $15000 (shares) = $12460 loss + assignment as opposed to $15000 loss without this strategy
MARA - I would get $3025 (CC) + $1050 (CSP) + $9900 (put) - $8000 (CSP strike vs share difference) - $14000 (shares) = $8025 loss + assignment as opposed to $14000 loss without this strategy
So it seems that I would get fuked pretty hard on PLTR but not as bad on MARA. Probably because the bid/ask spread on MARA is significantly better than PLTR.. INTREDASTING.
I've been mulling it over and have started to wonder if I should just quit trying to hold shares and make short term profits, and instead join theta gang.Spoiler!
Mostly I've been curious about how to maximize upside while minimizing downside; for example, thought of the following:
Buy 1000 shares of PLTR @ $25
STO 4/16 10x$30C for $980 premium
STO 4/16 10x$22P for $1060 premium
BTO 4/16 10x$25P for $2480 premium.. this is where I'm a bit sketchy. This is supposed to be my hedge. I have a feeling it would be less expensive to buy weekly puts when the premiums are lower.. thoughts?
At expiration:
$20.00 - I would get $980 (CC) + $1060 (CSP) + $2520 (put) - $2000 (CSP strike vs share difference) - $5000 (shares) = $2440 loss + assignment
$22.50 - I would get $980 (CC) + $1060 (CSP) - $2500 (shares) = $460 loss
$25.00 - I would get $980 (CC) + $1060 (CSP) - $2480 (put) = $440 loss
$27.50 - I would get $980 (CC) + $1060 (CSP) - $2480 (put) + $2500 (shares) = $2060 profit
$30.00 - I would get $980 (CC) + $1060 (CSP) - $2480 (put) + $5000 (shares) = $4560 profit
So in increments of $2.50, I'm looking at the following P/L:
$20.00 - Lose $2440 + Assignment
$22.50 - Lose $460
$25.00 - Lose $440
$27.50 - Gain $2060
$30.00 - Gain $4560
This kind of trade would tie up a lot of capital however. $25,000 in shares, $25,000 for the CSP.. pretty much my entire account at this point.
-------------------------------------------------------------------------
The other thing is, I was looking at the premiums for MARA.. holy moly. Feel like I should just do that instead of PLTR, but it seems like premiums are so high because it can crash any minute.
Buy 500 shares of MARA @ $38.00
STO 4/16 5x$45C for $3025 premium
STO 4/16 5x$26P for $1050 premium
BTO 4/16 5x$38P for $4100 premium
$20.00 - I would get $3025 (CC) + $1050 (CSP) + $4775 (put) - $3000 (CSP strike vs share difference) - $9000 (shares) = $3150 loss + assignment
$26.00 - I would get $3025 (CC) + $1050 (CSP) + $1900 (put) - $6000 (shares) = $25 loss + assignment
$38.00 - I would get $3025 (CC) + $1050 (CSP) - $4100 (put) = $25 loss
$41.00 - I would get $3025 (CC) + $1050 (CSP) - $4100 (put) + $1500 (shares) = $1475 profit
$45.00 - I would get $3025 (CC) + $1050 (CSP) - $4100 (put) + $3500 (shares) = $3475 profit ($25 less than just holding shares)
--------------------------------------------------
The benefit I'm noticing is here:
For PLTR, if the stock price were to plummet to $20, I would normally lose $5000 just holding shares. With this strategy, I only lose $2440. If the price moons to $30, I would get $5000 with just shares, but $4560 with this strategy except I'd get that downside protection.
For MARA, if the stock price were to plummet to $20, I would normally lose $9000 just holding shares. With this strategy, I only lose $3150. If the price moons to $45, I would get $3500 with just shares, but $3475 with this strategy except I'd get that downside protection.
So if I am bullish on both, essentially I am sacrificing $440 on PLTR to save myself a potential $2560 loss, and sacrificing $25 on MARA to save myself a potential $5850 loss.Assuming of course that my strike prices are the floor and ceiling, and the stock doesn't completely go down to something ridiculous or moon ridiculously either.
For chits and giggles.. let's say PLTR and MARA both insta dropped to $10.
PLTR - I would get $980 (CC) + $1060 (CSP) + $12500 (put) - $12000 (CSP strike vs share difference) - $15000 (shares) = $12460 loss + assignment as opposed to $15000 loss without this strategy
MARA - I would get $3025 (CC) + $1050 (CSP) + $9900 (put) - $8000 (CSP strike vs share difference) - $14000 (shares) = $8025 loss + assignment as opposed to $14000 loss without this strategy
So it seems that I would get fuked pretty hard on PLTR but not as bad on MARA. Probably because the bid/ask spread on MARA is significantly better than PLTR.. INTREDASTING.
I don't have enough time rn to go through all of your scenarios, but from what I saw you are pretty spot on with everything. My only thing, and this is purely a personal preference, when it comes to hedging I prefer to write calls vs buy puts. Worst case with a CC is that I can either chose to let the shares get called away, or I can roll up/out for better profit potential. I just don't like being out of pocket, which is what would happen with puts.
One thing I will say, if you are torn between options and longs, is do both... Quick and rough example on a stock you are bullish/interested in:
Covered Strangle Approach
Stock ABC is trading for $50, and you have $20k you want to throw at it and potentially wheel with. Instead of buying all 400 shares right now, buy half and then sell fairly aggressive puts for the "other half" with a call as well.
ABC has a $55 put premium of $6 (which if assigned would be lower than your other entry price), and a call premium of $2 at $55.
Scenario 1: The Stock plummets
Your covered call will expire worthless (or you can close out and roll down if you want to be aggressive)
You get assigned the CSP's at $55 (or keep rolling ofc)
BUT you received $8/share in premiums, so youcost basisis actually $47!
Now you can sell covered calls on your whole stack, or just be long
Scenario 2: The Stock Moons
Your CSP expires worthless
Your existing calls get called away (or you can roll up and out if you want to hold and get better premium)
So you cleared $8/share in premiums, and realized a $5/share profit in your original position
I know it's a little funky, and it does require management, but that's kind of the fun of it for me.
"It won't get better, just different."
03-17-2021, 12:44 PM
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#534
Originally Posted By TugOfPeace⏩
yeah, it's not the most straight forward lolThanks for the writeup. Hmm I'm a bit confused. .
Originally Posted By TugOfPeace⏩
Correct, and that's why this is a covered strangleIsn't writing a call just a CC since I have the shares?
Originally Posted By TugOfPeace⏩
Meaning, I don't want to pay for a put, especially if it expires worthless. And yes, the potential gains with a stock going down is far greater with a purchased put than a CC, but again, I don't like paying for chit lolAnd what do you mean by out of pocket with a put, I don't get that. If the CC is your hedge, it's not much of a hedge compared to the put, right?.
Originally Posted By TugOfPeace⏩
Correct. If I am bullish, or even think it will trade sideways and don't mind getting assigned, I will either get a juicy premium, or get assigned at a lower cost basis than my original stack. Also doing it at the higher price because of the call. It's just a more aggressive strategy with some "insurance" with the covered call component. It's definitely not for everyone, but will is something I am doing with stocks I would like to build on.Also in your example, are you doing a CSP at a high price because the premium is higher? I always thought CSPs were meant as bearish moves.
Buying puts = bearish.
Selling puts (csp) = bullish.
"It won't get better, just different."
03-17-2021, 12:57 PM
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#535
Originally Posted By TugOfPeace⏩
Not quite.Well chit, I had CSPs all wrong then. If you're doing the CSP as a bullish move then there isn't really any downside risk, right? If you're setting the strike at $55 and the stock never reaches, you just get the premium, but if it somehow slingshots to $56, you're still being assigned at a price of $55 which gives you not only the premium, but the $1 share price increase as well?
If that's the case then I could further reduce my risk by doing CSPs well above the $25 and $38 prices I mentioned in my example, since this would yield a higher premium?
I guess the only thing I don't know is if you can open a CSP and then close it prior to expiry assuming the strike has been reached.
If that's the case then I could further reduce my risk by doing CSPs well above the $25 and $38 prices I mentioned in my example, since this would yield a higher premium?
I guess the only thing I don't know is if you can open a CSP and then close it prior to expiry assuming the strike has been reached.
With a CSP, if you DONT WANT to get assigned, you need the stock to close above the set strike. So typically people sell puts below where it's currently trending, unless youknowit's going to go above $X. My example is an EXTREMELY bullish position. Best thing to do is play around with optionsprofitcalculator.com but here is an example of a moderately aggressive CSP with PLTR
http://opcalc.com/rQ8
Key takeaway, is your "break even" as in if you are assigned this will be your cost basis, or what price you can close (at expiration) for no loss should you choose to bail on getting assigned.
"It won't get better, just different."
03-17-2021, 02:15 PM
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#536
In the fictitious scenario, you could be “profitable” at any closing price between $49.01 and above. How much profit is calculated by the delta. So at $53 you could either assigned and be up, or you could close with a $4/share profit
"It won't get better, just different."
03-17-2021, 04:10 PM
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#537
- Carbonfibre
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- Carbonfibre
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took pause from options.
hard to track daily now very time consuming (have bunch of deadlines need to complete)
I am very surprised how hard RKT is getting pinned again.
It feels like hedges are driving attention away. Wsb has gone to UWMC train looking at option flow.
.......
BA has been rising really good lately. Its looking like it wants to go $300.
hard to track daily now very time consuming (have bunch of deadlines need to complete)
I am very surprised how hard RKT is getting pinned again.
It feels like hedges are driving attention away. Wsb has gone to UWMC train looking at option flow.
.......
BA has been rising really good lately. Its looking like it wants to go $300.
03-18-2021, 10:28 AM
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#538
Originally Posted By Carbonfibre⏩
Tempted to sell puts, but worried that it could very well drop back to $20-21... Then again, with premiums as juicy as they are, might not be horrible to keep wheeling... Will see after a week or two.I am very surprised how hard RKT is getting pinned again.
I know I said I was going to chill, but I am not looking at some long term holds (no tech) and want a good entry
STO
DHI
4/16
$80p @ $1.70 x4
I missed the boat at $78 last week because I had so much tied up in other plays, so maybe I will be able to get in.
I want to get my trading portfolio to 1/3 long holds (more money than in my IRA, plus can use as leverage). Currently holdingAXP andARKK. I am going to be assignedLULU which will be a long hold ($400 EoY, watch), as well as the rest of theARK etfs. Not sure if they will be long holds or not, because I am a little weary about so much tech exposure right now.
It sucks that all the value companies have such chit tier premiums. Hard to make money thetagang style in them. Would like to get into WMT, but going to ride out my call spread through next month and then reevaluate.
"It won't get better, just different."
03-18-2021, 12:38 PM
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#539
- Carbonfibre
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- Carbonfibre
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Originally Posted By chino3⏩
Monday those holding RKT get dividend so if they decide to buy more RKT than it could go up again.Tempted to sell puts, but worried that it could very well drop back to $20-21... Then again, with premiums as juicy as they are, might not be horrible to keep wheeling... Will see after a week or two.
Considering RKT is held by whales/etf they could buy more shares in RKT. I want to say it has better chance of going up than down.
I don't like the overall market.
Feels like sideways shiit is going to continue for while.
Till fed does something to stop these yields scaring tech sector to death. It feels like nothing will happen good for while.
03-18-2021, 12:53 PM
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#540
^^^ the record date already came and went, so the 23rd is just the payout date. That means the stockshoulddrop by the tax adjusted payout amount. Thinking about puts for 4/16 $22.89 @ $1.89 anyways. Even at $21 (effective cost basis), its a good price point to sell calls on if assigned. But I think I’ll wait until after the price adjusts.
Unrelated, last week and this week had me sweating on my tesla weeklies I set up (I sold calls for every week through April after I got assigned thinking a reversal was further out), but was fully ready to manage them aggressively with strangles as they went on. Now? Already back to green on 3 of them smh...
Unrelated, last week and this week had me sweating on my tesla weeklies I set up (I sold calls for every week through April after I got assigned thinking a reversal was further out), but was fully ready to manage them aggressively with strangles as they went on. Now? Already back to green on 3 of them smh...
"It won't get better, just different."
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