The best thing to do is not panic. As I said in my earlier post (Short-Term TSLA Price Movements - 2014 - Page 242) the stock was definetely overbought and what we see now is a correction. I think the support level is way lower than that, though. I have 20 shares myself which I bought at 260-s, very lame.
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Social Chat - Short Term TSLA Movements
- Thread starter Jonathan Hewitt
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The best thing to do is not panic. As I said in my earlier post (Short-Term TSLA Price Movements - 2014 - Page 242) the stock was definetely overbought and what we see now is a correction. I think the support level is way lower than that, though. I have 20 shares myself which I bought at 260-s, very lame.
Yea. I've been trying to get back all the option losses (mostly contracts that were 1-2 months out, not weeklies) during the 180->120 crash. I hadn't played options before, bad time to get involved. The 40% of my original stock I left as stock keeps growing of course, subtly reminding me what it could have been if I'd keep it's friends with it. If I'd never sold a single share and simply held, I'd have 50% more value in my portfolio than I do now.
I'd hoped this week was going to recover about 1/2 of that since it's not often you get spikes like this, but I managed to nix that. Who knows, maybe someday. I've got the money I started the week with, I just missed out on the gains.
I've slowly taking my ITM March options off the table as we descend below 250. Not sure when it will stop, but I am definitely taking some of that MS gap up off the table with the expiry drawing nearer. Using some of the profits to fund Mar/Apr puts.
Other than that, rolling up LEAPS (For a nice loss today) and sitting tight with cash at hand.
For once, I actually feel reasonably well positioned for a move in either direction, and will have cash on hand to scoop up calls on the way down. If it keeps going up, woo hoo.
*Note to self. The worst options play I ever made was buying Dec 175's on the way up to the Sept ATH of 194. I sold them off for a slight loss in October or something as we were coming off the ATH and gearing up for Q3 thinking "These are just going to bleed money." Never have I been more wrong. I don't even want to know how much those things could have saved my Q3 bacon had I held them to near expiry. (TSLA was nearing $117 around Xmas)
The lessons for me is. Don't buy medium term puts and sell them in the short term. You never know when you're going to need to have those in the back pocket.
marvinat0rz
Member
Whew. That concludes a stressful, interesting and ridiculously profitable week. Cheers to everyone, enjoy your Friday pint and congratulations on the profits 
Well I did it, sold off 100 shares and 2 '15 contracts, only about ~10-15% of my total holdings, and I'm now net cash. Still have very deep ITM '16 LEAPs which I wasn't planning on realizing until they turn long term. Too bad the '15s were short term but they had the least gain of everything so at least I won't have to worry too much about taxes on those, and all my current and forseeable losses will be short term so I don't expect to have too much trouble. I ended up replacing the 300 share-equivalents with 5 400/500 '16 LEAPs, which isn't quite the same leverage, but close, assuming the stock hits 500 by '16, which I think there is a fair chance of happening. Max gain on those is about 900% (bought for 11.50 or something), so seems like a fair enough bet for me, especially since it wasn't that expensive overall.
If we get a dip, I'll be able to buy in, but that wasn't the intent of selling. I just wanted to take some stuff off the table and get out of margin debit, considering I'm up multiple six figures since the beginning of the month, even though I was a stupid idiot and didn't play weeklies/March calls when I told myself I would (I still have my little reminder, which I ignored, "buy March calls" from Feb 21 to taunt me). Utterly insane month/week anyway.
edit: something odd that did happen today is that I noticed, again, that I seem to lose more money (in terms of "total account value") on drops than I gain on rises of equivalent point values. I suppose I don't quite fully understand how leverage works on LEAPs, but that was a little bit disappointing. Maybe it's because these 125/175 '16 LEAPs (bought as stock replacement) are so deep in the money and I suppose thinly traded that I guess anything can happen...?
If we get a dip, I'll be able to buy in, but that wasn't the intent of selling. I just wanted to take some stuff off the table and get out of margin debit, considering I'm up multiple six figures since the beginning of the month, even though I was a stupid idiot and didn't play weeklies/March calls when I told myself I would (I still have my little reminder, which I ignored, "buy March calls" from Feb 21 to taunt me). Utterly insane month/week anyway.
edit: something odd that did happen today is that I noticed, again, that I seem to lose more money (in terms of "total account value") on drops than I gain on rises of equivalent point values. I suppose I don't quite fully understand how leverage works on LEAPs, but that was a little bit disappointing. Maybe it's because these 125/175 '16 LEAPs (bought as stock replacement) are so deep in the money and I suppose thinly traded that I guess anything can happen...?
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kishdude
P #130
Such is the nature of options and time value erosion. You have to remember that every day (every hour really) every option contact slowly loses value as the time to it expiration is getting shorter even if the underlying stock makes no move.
FredTMC
Model S VIN #4925
Maybe you can pay someone to drive you so you can trade while going to work, and the chauffeur takes the train back. And on low volume mornings you have a nice 45 min nap in the car
solution is a self-driving tesla. It's coming. Just ask Adam Jonas..
Id love to be able to cruise the 405 in the car pool lane and have the car drive itself.
These are 2 years out though, and so deep in the money that they have very little time value now. Not a lot of volatility either.
I think it has to do with how your brokerage calculated value of an option. Some use the bid price, some do some kind of math to come up with a "market price".
I think that some brokerages show you the conservative valuation of an option so that you don't think that you have more money than you really do.
This would certainly solve the issue of ckessel missing the first 45 min of trading due to commuting.
Hmm, I didn't care much about about auto-driving, but maybe now I have a reason to care
anticitizen13.7
Not posting at TMC after 9/17/2018
My observation over the years has been that for most people, attempting to time the market is foolhardy.
Tesla's plan is a multi-year one, so I think that investors today should hold on to their shares for perhaps five or more years.
Options of course are an entirely different game.
@FANGO
Sleepy's exactly right on this. For example my broker computes he vales based on Bid price during trading hours, then after market closes,they us last trade or if none a midpoint of bid-ask. My account balance actually moves up by thousands after closing just due to this. Your so deep and long on expiration, the time decay on those is close to nothing. That said consider a little higher strike hat has more volume. On balance though I like your approach to use ITM LEAPS as stock leverage. Good move IMO
Chickenlittle
Banned
Deep in the money options will actually be valued less than the value if you exercised the option and sold the stock (less the strike price). Schwab would argue that would be reasonable since doing that could lower the stock. Like 150 options could have an effect on a stock with average of 9 million shares sold on an average day
I think my brokerage uses last trade at all times.
And I did like the stock replacement move, but it didn't result in quite as much upward movement as I expected. I was hoping to increase my leverage when it went down (130-140ish) by selling shares and getting more itm leaps, but I ended up with about the same leverage up as I had before. It did decrease my margin debit though, which helped a lot because I was in danger of getting margin called at the time. So I think it was mostly a good move. Tried to replicate that just now too, sold enough to be net cash and replaced with leap spreads - taking some profit but hopefully still getting to participate in nearly as much upside. Hope it works out, still getting the hang of complex options.
Just a tidbit on the old Tesla-Apple rumor: I have long speculated that the purpose of the Apple & Elon meeting that had the market abuzz with merger rumors was really about Apple trying to get its products into Tesla's cars. The thing is, it would be extraordinarily difficult to seamlessly integrate Apple software into Tesla's fully-integrated car software without completely rewriting the code that runs the Tesla, which would be utterly pointless and would more than likely severely degrade the product for no benefit to Tesla or its customers.
But it would appear Apple is still trying to push into the car "infotainment" market -- saw this this morning:
Apple is reportedly launching iOS in the Car next week with Ferrari, Mercedes and Volvo
Having ios software run a car's mp3 player, nav and phone, maybe do some calendar and web tricks, is not the same thing as building, testing and optimizing a fully-integrated car command & control system like Tesla's engineers have done over the last decade.
This news actually makes me even more confident that every other automaker on the planet is completely behind Tesla Motors in the critical "Secret Sauce" of the car's software. They will either need to buy Tesla's integrated solution sometime in the future, hire hundreds of Silicon Valley engineers and build their own integrated car software, or risk obsolescence.
But it would appear Apple is still trying to push into the car "infotainment" market -- saw this this morning:
Apple is reportedly launching iOS in the Car next week with Ferrari, Mercedes and Volvo
Having ios software run a car's mp3 player, nav and phone, maybe do some calendar and web tricks, is not the same thing as building, testing and optimizing a fully-integrated car command & control system like Tesla's engineers have done over the last decade.
This news actually makes me even more confident that every other automaker on the planet is completely behind Tesla Motors in the critical "Secret Sauce" of the car's software. They will either need to buy Tesla's integrated solution sometime in the future, hire hundreds of Silicon Valley engineers and build their own integrated car software, or risk obsolescence.
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Good points.
Integration is not the way to go. Developing a unique system from scratch is the solution.
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