Hello,
Back in mid December 2019, I sold a straddle & bought a strangle on Tesla. Specifically, I sold:
2 Calls & 2 Puts, both with a $430 strike & Feb. 14th, 2020 expiration.
I bought 2 $435 Calls & 2 $425 Puts, all February 21st, 2020 expiration.
I received about $360 from this trade.
Obviously, Tesla has gone practically straight up (& pretty massively). In fact, as I write this (after hours after earnings), TSLA is up about another $66 to $647!
Earlier today, I saw I could've closed out the whole position for about $1200 which would've given me a net $840 loss. However, holding it until the short straddle expires (or almost expires) should only have me closing it down $1,000 or a net $640 loss.
Does this sound like the right approach?
Thanks in advance.
John
Back in mid December 2019, I sold a straddle & bought a strangle on Tesla. Specifically, I sold:
2 Calls & 2 Puts, both with a $430 strike & Feb. 14th, 2020 expiration.
I bought 2 $435 Calls & 2 $425 Puts, all February 21st, 2020 expiration.
I received about $360 from this trade.
Obviously, Tesla has gone practically straight up (& pretty massively). In fact, as I write this (after hours after earnings), TSLA is up about another $66 to $647!
Earlier today, I saw I could've closed out the whole position for about $1200 which would've given me a net $840 loss. However, holding it until the short straddle expires (or almost expires) should only have me closing it down $1,000 or a net $640 loss.
Does this sound like the right approach?
Thanks in advance.
John