AquaY
Member
Those are some nice premiums.Sure - last week I STO 1510 ($30 premium), 1515 ($25), 1520 ($30) SHOP puts expiring 8/13 - sold while the stock was dropping following an earnings beat (like TSLA). This morning, the stock popped $30 before being walked back down. I sold a portion of my positions for 85% profit, but since I have time on my side and believe the stock will continue to climb out of the 1500's kept a few to close for pennies on Friday. This weekly put example nets premiums worth $28K (10 total contracts).
Also on last week's weakness I sold some high premium ~monthly puts - Aug 27 1500 ($60) and Sept 10 1550 ($100). These I expect to close w/ 90% profits in the next week or two as the stock makes its way back to the $1600's - these generated $52K in premiums for 6 contracts.
I haven't opened TSLA puts this week because of the relative margin use (IBKR margin req's are much higher for TSLA) and SHOP had the red momentum opportunity. If TSLA has a few red days then I'll take advantage of the momentum with TSLA.
I use Etrade and the margin used to make similar trades between TSLA and SHOP seems about the same.
To sell the equivalent TSLA puts I'd have to do about twice as many ( 21 TSLA vs 10 SHOP) to commit the same amount of margin, and the same amount of cash if they were exercised. I looked at some options for Aug 21 expiration and using similar IV and TA of stock price probabilities I found them to be pretty similar with SHOP doing somewhat better. A little more premium and a little better risk. But very close.
Of course I did this very quickly and would have to spend some time running some trades but it seems like a nice diversification even if I don't yet see the far higher premiums and margin requirements as you've experienced.
Always great to have options when trading options!