todays $TSLA entry

started today long TSLA via the Jan2021 200 call as noted in previous entry. was hoping for a move up today near 260ish to be able to sell a weekly short call into earnings to reestablish the diagonal spread. sentiment on CNBC seemed to be negative so instead I opted to sell the weekly 265 call and use that premium to buy the 252.50/240 put spread. the 3legs filled for a .25credit with stock near 254

remember the delta for the Jan2021 call was 75 at entry(call option goes up about 75cents if stock goes up a dollar). so im getting upside participation until 265(the short call I sold). I wanted more downside protection than just the $5.00 or so premium that the short call was going for. if the stock sold off I would get $12.50 worth of downside protection and lower the cost basis of the Jan call.

Stock crossed 300 after hours tonight so historically its been tough to keep trying to roll that short call(the 265) up for a credit this far in the money. stock just ran too far for my taste to keep rolling out for pennies just to gain another week or two but will see how the options are priced vs next week or couple weeks out. I already lowered the cost basis of the long call via a short call sale last week. will see how everything prices out tomorrow.

never know, maybe it pulls a NFLX and gives back its gains

$AAPL 2022 diagonal spread entry

going to start building up some AAPL diagonals going out to the Jan2022 strike.

Today bought the Jan2022 200 strike call, filled at $60.71, stock was at 241ish when I placed the order, delta about 75. so there is about $20 of time premium, rest of this year, all of 2020, all of 2021.

the other leg of the diagonal was selling this weeks 245 call, filled at $.71, delta 25.

Best case would like closing near 245, take off the short call, and then leaning towards at weekly ratio spread for the earnings since everyone is bullish the stock. will see day of earnings

$MSFT short put sale 10/22/2019

Rule number one I have is to only sell naked puts (cash secured puts) on stocks that im ok owning if put the stock.

so today pre-earnings tomorrow sold MSFT this weeks 133 puts at $1.07, premiums are a bit juiced because of earnings tomorrow and stock pulled back a bit as well. level i looked at was 133 area since that is the bottom of the channel (or darvas box for you cool guys) its been trading in since August. making the assumption that the bottom of the channel holds thru earnings report.

If stock goes up on earnings will look to close out for profit.

If stock goes down on earnings i will look to roll the put to a further week best case for a credit. unlikely i will hold this till opex and get put the stock but ok if that happens.

$NFLX busted trade ?

saw this response from Mike Khouw today on twitter to a question from someone that followed Mikes NFLX trade on options action:

Michael C. Khouw

@Michael_Khouw

Because you still own the Jan'20 puts you are synthetically long a call. I am not particularly bullish $NFLX here so my inclination would be to either a) close position/take profits or b) adjust into a nov/jan calendar.

@OptionsAction

Quote Tweet

Ernest Bates

@ErnestRBates1

· Oct 19

@Michael_Khouw I put on the NFLX 280 Put calendar spread (short Oct. 18 weekly vs. long Jan. 2020) you recommended last week ahead of earnings.  Great recommendation!However, I did not close out my trade upon the Oct. 18 expiration, so I was put the stock. What shall I do next?

I took the liberty to respond to Ernest Bates directly and don't expect a response but wanted to share what action I would recommend. Given that I don't know the entry date or pricing or where the stock was at the time of entry.

First of and most importantly if you have a put calendar and the front month or weekly short put is about to expire either in or out of the money ALWAYS close that position. either buy it back, roll it out, roll it down. Don't let it dance around the short strike hoping to close out of the money to get every penny of the decay. the last thing you want to happen is to be forced to buy the stock (put the stock) at 280 for this trade. especially if that's going to force you into a margin position.

But now that you have been put the stock and have been forced to buy the shares at 280, assume just one lot of 100. im assuming your thesis was bearish to begin with so either sell the shares outright to exit this position or I recommended sell a covered call:

mark lexus

@Mark_Lexus

Replying to

@ErnestRBates1

against the long stock you were put.. sell Nov 277.50 calls at $9.50ish, stock at 277.65 as i type. Hope it gets called away

take in that juicy premium of $950 for the one lot and if it gets called away no problem. secondly he still had the long 280 put in Jan2020. for that portion I recommended:

mark lexus

@Mark_Lexus

Replying to

@ErnestRBates1

and part 2 sell short the Nov 265puts gets you to a Put calendar with your January puts $nflx

this is what Mike was recommending in part B, seem to recall that as I was typing the Nov265puts were in the $4-$5 range. this reestablishes the calendar spread, brings in another $400-$500 of premium.

If the stock goes down you have gains via the long 2020 put down to 260ish (nov265put-the $5 premium) and you've taken in the $950 from the covered call. if stock goes up you get the shares called away at about $287, keep the short put premium and can resell a Dec short put .

Just some thoughts, depends on your thesis going forward. can just close out everything and take any profits and move on to the next one.

but the main point is close that short put in some way to not have to go thru this exercise. you never know whats going to happen in the final 30minutes of the opex week or after hours or youre unable to watch the market in the last hour.  the only time I would let the stock get put to me if im ok holding the shares but in that instance I would just sell cash secured puts

I have no position in NFLX at the time of this post