Bought $TSLA 11/12 $1,000 Puts
- 7 contracts for a total premium of $9,530.
“Run from what's comfortable. Forget safety. Live where you fear to live. Destroy your reputation. Be notorious. I have tried prudent planning long enough. From now on I'll be mad” ~ Rumi.
3 linked trades
I'm also betting that Tesla will fall to around the $1,000 level (just sold some shares, didn't do options). Long term bullish though.
@ebcapital recently had a great comment about the tailwinds for Tesla long term.
@sufiofwallst do you have an opinion on Tesla long term?
While I am bullish on the prospects of $TSLA in the long run (their software + hardware combo creates a unique moat similar to $AAPL) with all the verticals they’re disrupting (incl. auto insurance and ride share) I think the valuations are too stretched at these levels. I think $TSLA can command a trillion dollar market cap but I don’t think its deserves that valuation today.
Having said that, I also think the options market is playing a gigantic role in pushing valuations to these unrealistic high levels. The sheer amount of call option buying is ridiculous and with market makers getting trapped in gamma squeezes/ rushing to buy shares to remain net neutral as the price keeps moving up makes partially explains the vertical rise in the price we’ve seen over the past few days.
This trade isn’t a bet against $TSLA by any means - its just a bet on the stock price cooling off and technicals normalizing. The RSI on the daily chart is at 86 and every other technical I overlay is as stretched as its ever been. The stock needs to breath and I hope it does that over the next 7 trading sessions.