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Friday, May 6, 2016

Tesla (TSLA) Post-earnings play

Thursday, 5/5/2016 (11:18:43 am, PT)

sold -1 May 6, 2016  $205 put at $0.91

Why did I place this trade?
  • earnings were announced after the close on 5/4/2016
  • the stock dropped on 5/5, so implied volatility was still high
  • quick, 1-day trade to take advantage of the inflated IV
  • 79% probability of success
  • Robyn at Tasty Trade sold the May 6 $210 put (thanks, Robyn!)

Friday, 5/6/2016 (9:36:42 am, PT)

buy back put at $0.05

PROFIT:  $86 (in ONE day!)


  • My put option hit $0.04 at 6:34 am this morning (5/6), but I had forgotten to set a "buy to close order at $0.05" last night, so I missed it this morning.
  • Between 6:34 am and 9:36 am, TSLA dropped, so the put price rose again.
  • The market makers made me suffer for 3 hours before finally accepting my bid of $0.05.

The moral of the story:

ALWAYS have your closing orders in place!!!