Moron . Naked put options otm Friday. BUT stock price went down after hours...interactive brokers

destriero said:
The 430C should be marketable at 19 with shares at 375-380.
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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.
 
taowave said:
Dude needs to play great D..
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Right. This is a great and very useful thread due to ET heavyweights’ contributions. I am far from it, but since I have been in this situation a few times, I would like to contribute my $0.05 (although I never faced margin calls)

Since I am more comfortable with trading underlying, I only sell enough calls to cover my position - I am never naked short calls underwater.

So my goal is to make sure my avg price is close enough to current price so that I can keep selling weekly covered calls at reasonable premium at the strike above my avg cost.

If price rises above my avg, I will get out of shares at BE or better and will hope calls will expire worthless in a few days. So It’s possible for me to be naked short calls as long as they are OTM. I will be watching price closely to make sure my calls are not challenged. If price too close to strike (within overnight gap), I will not take a chance, I will get long at least half size to hedge. If price keeps rallying, I will be forced to buy the rest and try to trade out of them, basically looking to catch an intraday top. I am basically day trading hoping to be flat as price falls but with understanding that above certain price I MUST be getting long to hedge my calls.

Of course the above benefits from bull rallies we’ve had. What to do when it keeps going down? Well, my only choice to recycle shares to make sure my avg price doesn’t get too far away. So reduce position on rallies and re-buy on drops or pull backs. At this point I am taking a beating but giving myself a chance to come back. Hopefully I can still able to sell calls far enough away to not get called by the end of the week.

I may be wrong, but I am a strong believer that prior to trading options, one needs to be able to trade the underlying directionally.

Hope this is helpful in some way. To be clear, this is not a strategy that I purposefully trade, but rather a way for me to get out of situation I did not expect to be in. It’s me playing defense the best I know how after a f#% up :).
 
You mean you would buy the stock and exercise the put..

Or if you were short the put,you would short stock, hopefully being 100 percent sure you were assigned on the short put..

Your wording was a little confusing:)







ET180 said:
You'll definitely get the put assigned. Assignment depends not only on where the stock closes, but also on what it does after hours. If I had a Tesla put Friday after 4:15 PM that went ITM, I'd simply short the underlying and exercise the put, collecting the delta. I would do that until the exercise cutoff. But how bad is it really? A $10 move of 100 shares if $1000. So from 419 to 390, that's $3000 which will be partially offset by your short shares. Probably best to just close the position and move on unless you are bullish in which case sell a call until you lose the shares.
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Tsla moving lower, does anyone know how much margin robinhoodies need to buy tsla.. 25%? We may see some panic selling along liquidations today...
 
traderking007 said:
Im short tesla and long nikola and its working out great. i would get out asap or hedge with single stock futures on eurex if u can add that exchange fast enough. china may threaten tesla as i alluded to before. if china uses tesla as a bargaining chip for tik tok etc then tesla could drop another 20% in an hour. that would be an event shock for sure would screw with a lot of models
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Nice trade for this morning, both ways.
 
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