TSLA options

[BlueWaterSailor]

I am getting scared of trading options, especially TSLA.

Excellent. That might eventually stop you from firing off random trades that you obviously don't understand, and get you to either give up trading options OR doing a bit of studying so you'll understand why you shouldn't do this.

I bought a debit spread OTM with 4 days left.

Repeating: "...why you shouldn't do this."

Expanding a bit: look up the definition of theta (even better, look at the curve showing theta over time to expiration.) Then come back here and tell us why doing the above is a REALLY bad idea.

Question; how the hell can TSLA trade at $1600 but the options cost 13k?

Look up the inputs to the Black-Scholes formula, and note the one called "implied volatility".

Other question what the hell did I do wrong? I was right about the market, but it seems options have special ways of screwing me!

If you take a drill to your forehead, it's not the drill that has "special ways of screwing" you.

 

[Overnight]

...
Expanding a bit: look up the definition of theta ...that has "special ways of screwing" you.

I learned the most basic definition of theta. The decay in value over time. How about ateht? It is the unfounded principle that the longer you wait for a future index to up in value, the more likely it becomes a reality?

The FACK did NQ do today? 550 point run straight-up from the midnight close until now? WTF with larger caps. Sorry for the tangent, just musing about how ateht is real. :-\

 

[taowave]

Judging by your post,I will go out on a limb and say you may not be ready to trade TSLA..

Im assuming you know earnings are coming out on the 22nd,vol is jacked..

The market makers did not drop vol 40 handles on you.

First you said you legged a spread,took a small hit,got out and then revenge traded and bought a call...TSLA rallied,but you took a 10 point hickey and then said BOTH your options finished ITM,but you were only long 1 call..

You totally lost me comparing 1 share of TSLA costing 1600 dollars with a 13k option position.
Are you trading 130 dollar options/spreads??? You did mention your spread cost was 5.75...Where did 13k come from??

I am getting scared of trading options, especially TSLA. I bought a debit spread OTM with 4 days left. I could not get a fill as a spread, so I did individual legs, the spread had a debit of $225 but somehow when I did the legs I had a debit of $575. I saw my long option making a lot of money while the shot option was losing even more. I was cursing the moment I decided to spread the blimey thing. (I should have gotten in with a call only) Eventually, I got out with a small loss($200). Already annoyed(but trying to mend the situation) I went long of one call, a few minutes later the market maker just killed the IV, to the tune of 40+%. Now I was holding an option with a $1000 loss. While TSLA moving my way! Both my optioned finished ITM. I lost $1200!
Question; how the hell can TSLA trade at $1600 but the options cost 13k?
Other question what the hell did I do wrong? I was right about the market, but it seems options have special ways of screwing me!

 

[TimtheEnchanter]

Judging by your post,I will go out on a limb and say you may not be ready to trade TSLA..

Im assuming you know earnings are coming out on the 22nd,vol is jacked..

The market makers did not drop vol 40 handles on you.

First you said you legged a spread,took a small hit,got out and then revenge traded and bought a call...TSLA rallied,but you took a 10 point hickey and then said BOTH your options finished ITM,but you were only long 1 call..

You totally lost me comparing 1 share of TSLA costing 1600 dollars with a 13k option position.
Are you trading 130 dollar options/spreads??? You did mention your spread cost was 5.75...Where did 13k come from??

After the debit spread, I bought one individual call. And some TSLA ITM options (1640 calls) are $13000.

 

[taowave]

You went from. Trading a 3 dollar spread to a 130 dollar call with a 7 dollar bid offer spread?

After the debit spread, I bought one individual call. And some TSLA ITM options (1640 calls) are $13000.
View attachment 235452

 

[OptionsOptionsOptions]

After the debit spread, I bought one individual call. And some TSLA ITM options (1640 calls) are $13000.

Do you plan on selling before earnings (Wed) or after?

• TSLA at $1,643
• Long July24 1640 calls @ $130
• Price target after earnings $1,773+
• 52-week high $1,795

 

[marketcentral]

people play options cause you can possiblly make 100% or ROI in a week if you are lucky same as gambling not investing, not even trading. without doing anything. or lose 50% of your capital in a week with options. and with some options there is counterparty risk or negative pricing for options in energy options which is BS too. in BS rigged market.

also the way they price these OTM put and call options is BS too. and is mostly option players who 'play' the options. with these 'sophisticated' condos or spread BS

 

[.sigma]

OP, I only read the first few words of your post...

“I am getting scared of trading options”

you are doomed then.. trade smaller or don’t trade

 

[OptionsOptionsOptions]

• I'm rooting for the OP.
• Those 1640 calls could easily make a killing - and most likely will.

 

[TimtheEnchanter]

I have no positions anymore. I lost a $1000 on one lousy contract.