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From last night to tonight's muted trading session. CLZ20 has traded almost 4000 more contracts than CLX20. The quarterly's often have higher volume than the in between serials. That especially true for options volume. But I think that CLX20 becomes the dominant contract as CLV20 rolls off.

Also, get the hell out of it when it starts trading negative. Stay in the positive one.

"Just keep both months up. When you see the volume flip from one month to the next, you just follow along." I missed reading your earlier post.

Pretty simple. Just switch over when the second contract's volume equals or exceeds the expiring contract's volume....either intraday or EOD volume totals.

If vol and call skew is high enough on the open, maybe sell enough to where he's somewhat delta neutral....eliminate most of the immediate directional risk so he's mainly just left short upside vol and gamma.

Depends on where the stock opens up. At 390, the 420-430 strikes will still have some meat. But the stock is likely to be much lower, some calling for sub-$350 on Tuesday's open...so he might have to sell the 405 strike or lower if he's determined to ride out his long TSLA position. He could...

Uh, the post is about Softbank and their doubled-down bet on Big Tech. They loaded up on TSLA stock and TSLA calls....a Texas hedge.

I think he was short 10 of the 405s, got assigned, and is now long 1000 shares at 405, which were trading in the 390 range after the announcement. Vol is going to be jacked on Tuesday's open, so I like the idea of selling upside calls, which they'll crush on any relief rally.

Looks like they are going to get murdered this week on those Texas-hedged TSLA calls.

If you're selling naked puts you have to be willing to buy the stock at the strike price. You obviously are bullish on TSLA, so if assigned, you may just have to cough up $40K+ to buy the 100 shares at 405 and ride it out till the stock comes back.

Put owners/buyers going into March's crash made generational money. Some prominent put and premium sellers lost 10+ years of earnings in 1 week in March. Don't be a lazy put seller.

Where was the stock when you sold the gut strangle? No way you sold those 280 calls that far under parity (QQQ range for Aug 26th was 285.83 - 292.22). You must mean the 288 or 290 Calls.

Maybe he was hitting the "hard" bid on DITMs with only a few days left. Even then I can't see the QQQ ITM markets being that wide. He said it was a scratch ("breakeven") so his prices or strikes he told us must be completely off.

Kevin points out exactly how your "FairPuts" could easily be arbitraged. If you sell a standard call and hedge one-to-one with long stock you synthetically create a short standard BSM put, which you are trying so hard to get rid of. By creating a short standard BSM put (by selling the BSM call...

Well it makes plenty of money, and my option prices are always spot on with the MMs. If I used the FairPut model I would just be long every put and short every call....and deep in the red. The FairPut model would make me lift every put offer and sell every call bid on the screen. You would...

If stock prices cannot go negative, than puts cannot have unlimited MaxProfit/MaxLoss. The most a put can be worth is its strike price if a stock can't go below zero. That is a very easy concept to understand and no amount of voodoo math can disprove that fact. For a lognormally price...

Like I said before. "FairPut" doesn't work for stocks or equity indexes where prices can't go below zero. The Bachelier options model uses a mathematically correct version of your "FairPut", and its been around for many years, so your idea is nothing new...it's actually a poor copycat. I...

@thecoder You can ask or survey anyone on this forum. If you short any $10 TSLA put, the most you should be able to lose is $10. Telling someone they could theoretically potentially lose thousands or millions of dollars shorting 1 $10 Tesla put makes your product both unmarketable and...

I was referring to the $10 TSLA strike, but let's go ahead and use your 100 K strike TSLA "FairPut" example. According to your calculations the 100 strike TSLA "FairPut" only needs to be $95.3271028 [100 (K) - 4.6728972 (TSLA stock price at expiration)] in-the-money (ITM) to be worth $2,040...

The $10 strike TSLA calls are worth $2,040 if they expired today. So at what spot price (TSLA stock price) at expiration are the $10 strike "FairPuts" worth $2,040?