Investor Did 3.5M on Tesla! Do This Next!
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A Tesla investor made a ridiculous move in regards to Tesla call options less than 2 months ago! They have made crazy money in these call options. 3.5 mil+ pretty much. That is over a double up from their initial Tesla buy order. They should do this next in my personal opinion… No it was not me who did this 3.3 mil move lol That is funny though. Was it Elon Musk Tesla CEO who did this move?!
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Well, guys, just a short 47 days ago, I put out a video on financial education to talking about this investor that bought $3.3 million worth a Tesla stock 15 $100 call options. Okay, this was essentially a bet that tests a stock will go to 15 $100 plus by a certain date. Okay.
I want to do a follow up on this video here today. Okay, I want to tell you essentially what they’re looking at right now. And I want to tell you, in my opinion, what they should be doing with the money right now.
Should they be selling it out? Should they be buying put options? What should they be doing? I will be giving you my full opinion. I thought this would be a fun video to do here today, especially with Tesla stocks rise recently, like it’s been incredible.
I mean, this was one of the craziest moves I’ve ever seen by any investor in the stock market, like in an intense move. Even the W SB community would be proud of this work. Okay, this was just one of those YOLO moves 3.3 mil.
I mean, on a 15 $100 call that was way, way out of the money at that particular time. And there were a lot of jokes. I remember in the comment section people say it was me, okay, it was not me guys.
I just wanted I just want to put that at rest. It was not me, I swear it was not okay. I know a lot of people thought this might be something I would do. And you know what it was just wasn’t me. Okay, that’s all I’m gonna say here.
But we’re Tesla’s rise recently in the stock these call options have made this individual millions of dollars. Okay, let’s get into this guys. I hope you enjoyed as always smash the thumbs up, start getting in this okay. So here’s essentially what it was. Okay? Remember, call option isn’t is essentially a bet that the stock price is going to go up a lot over time.
Okay, so they bought it a 15 $100 strike price that day, when they bought, they paid roughly around $90. Okay, so think about it as $1,590 is the breakeven. Now when you ever you buy call options, put options, you can sell them off to somebody else whenever you want.
Okay, and remember, these call options expired January 21 2022. So there’s still a long way from expiring. However, with that being said, if that individual wants to sell out of those, they can get somewhere around $190 each for those as of right now, which essentially means that they just over to X to their money.
Okay, it was a $3.3 million bet. And so that means essentially now they’re like 3.5 plus mil, in the positive, okay, incredible, absolutely incredible. This person, if they want to solve these, they literally can take a 3.5 to maybe a little more than a $3.5 million. profit. Extraordinary. Let’s all give a round of applause for this individual.
absolutely incredible. Okay. I mean, you know, that’s just something that’s just crazy mind this is put it that way, I mean, making $3.5 million profit in a matter of such a short amount of time, but they took a big risk.
I mean, these call options are way out of the money. So this was a big wreck. So let’s be honest, but still 3.5 mil plus, in a matter of less than two months. Like that is just absolutely insane. Why is this what Tesla stocks improved a lot since then, remember, when this individual opened up that position, Tesla stock is trading at what 600 $700 a share.
Now it’s trading roughly around $1,000, you know, give or take, you know, 10 $20, something like that. So the stock price of Tesla, this is basically why these call options have begun to get so much more valuable. The stock price has just gone up several $100. Since that individual opened the position.
It’s been amazing. Okay, so we know they’re up massively on this position. In my opinion, there are five real options this individual has, they have more than this, okay. But these are the five most realistic options that they have.
I want to share with you what I think they should do, what is the best option, we’ll start with the worst options, in my opinion, go to the mid tier, and then we’ll get to the last one what I actually think they should do now in this position, okay, because they got a massive profit.
Okay, these first two are the ones I like the least Okay, of these five options, okay. One is to sell all the contracts. So basically just sell out of all the contracts, which now they should have roughly $7 million, or maybe a little less than $7 million in value of those call option contracts.
And so they sell it all off. They take an incredible profit, I mean, an absolutely incredible, incredible profit, nothing wrong with that they just completely get out of the position. I know like that one a lot.
Remember this individual they want exposure to Tesla stock and they want it you know, specifically over the next year or two. So if you sell off all your contracts, now you’re in a situation where you have no exposure to Tesla stock and
I don’t think that’s an ideal situation, especially if you’re somebody that wants exposure to the stock it also keep in mind if this interview sells off those contracts. And they take that profit of let’s say $3.5 million, depending on what state they live in, let’s just assume their us buyer rate, depending on what state they live in the basically take a half that money away, okay?
Because the federal government’s going to take a huge share of that. Remember, they’re going to be in the highest tax bracket possible. And it’s a short term trade. Okay, nevermind that if they live in New York, California, one of these very high income tax states rate.
They’re going to have to pay another 10%, if not more than 10% on top of the federal tax rate. So this individual could be basically looking at that 3.5 million profit that say, go down to what, 1.7 mil which 1.7 mil is still a nice profit. But goodness 1.7 pose is not that much when you compare it to 3.5. Right?
So this is why I’m not the biggest fan of this whole idea of let’s just sell everything off. Take our profit because all you got to you know, you’re going to take a nice profit, sure, but the government’s going to get crazy money crazy money out of that money. Okay?
You know, that’s why sometimes it pays to be the government, right? You collect that tax money, that’s some easy money right there, right? Number two option is sell no contracts. So essentially, let this puppy ride Okay, let this puppy right.
I’m not selling now this I’m gonna ride this all the way till January 21 2022. When these option contracts expire, I honestly don’t like this move either. Okay, look at the Dow today, that was just flex on everybody who’s trying to say the Dow could never go down the market stock market in general couldn’t go down, right?
It’s just flexing on everybody out there saying, Hey, I’ll do what I want. Okay, that’s what the stock market says, I don’t care what all your Gods say. I’m gonna do what I want. And along with the stock market being down, guess what else is down Tesla miasto stock now Tesla’s not down as much as the markets down, but it’s still down. And so let’s just be honest.
If the market moves down, huge Tesla stocks probably gonna move down pretty big with it. And we’re in a scary stock market right now, in which you know, a lot of stocks have gotten very overvalued, the market in general has gotten very overstretched.
And so it’s not impossible to imagine the market going down for several months, or maybe even potentially a year, okay? Remember, really a year and a half away from these option contracts expiring.
So if we’re in a downtrending market that let’s say goes for three months, six months, or potentially a year, that puts Tesla stock in a really tough position to be 1500 plus dollars, which is where the stock price needs to be in remember, as of right now, with the you know, basically the premium on top of where the stock price needs to be, we’re talking about 17 $100.
And if the stock market downtrends massively, whether it’s just for a few months, or whether it’s for a year, that’s going to that’s going to put Tesla stock in a very tough position. And this is why I don’t really agree with just holding all those contracts. Kay, you know, it’s a scary market, when.
I’m doing videos like this, like I did, you know, what, one day and 15 hours ago, where I basically making a video about, you know, selling stocks and taking profits, you know, this is usually the guy that’s doing videos about three stocks, I’m buying blah, blah, blah, month, right? You know, it’s a little different.
When I go from three stocks, I’m buying two, let’s take profits, and let’s talk about, you know, taking profits in this market, you know, we’re in a different time place. So to imagine Tesla stock going down, it’s not impossible, okay, here are their okayish options, in my personal opinion, they got a couple okayish options.
I’m not a huge fan of these, but at the same time, I can understand them, Okay, number three, is you sell half those option contracts, and then you play with the house money on the other option contracts.
By the way, let me know in the comment section, which one of these five, you guys think is the best option, I’d really love to hear your guy’s opinion as well down there, but this is one of them, okay, you know, sell half play with house money.
So remember, you know, they’re, they’re approaching $7 million worth a call options, they got 3.3 in it, right. So sell half of them off and go take a look, you know, very, very small profit, and then you’re just playing with house money, essentially, for all the other option contracts out there.
And, you know, sometimes this is a strategy a lot of people like to use in the stock market, sometimes also do with a stock that doubles up. So let’s say you buy a Tesla stock, for instance, or any other stock out there.
And let’s say you buy it for $500, it goes to $1,000. And you bought 100 shares, sometimes people will sell off 50 shares, take the profit on that they doubled up their money, right? They got back their full initial investment, and then they’ll let the other 50 shares, right.
It’s not a bad strategy. A lot of people use this model and say a lot of people use a strategy. But a decent amount of people use this strategy when they’re talking about something they doubled up their money in when it comes to stock market, and there’s nothing wrong with it.
I gotta say it’s not it’s not a bad strategy. Now, keep in mind, sometimes the opportunities are much bigger than a 2x opportunity in the stock market. So sometimes you could be selling yourself a little short, no pun intended.
Whenever you take a short term profit like that, but they could do that. Okay. Number Fourth thing they could do is sell $1 million, or $2 million, let’s just say $1 million worth of these call options off.
So if they got seven mil now worth, these call options sell a million, so they only have 6 million and buy puts, okay, in terms of put options on this one, they would have to probably, uh, you know, it probably makes the most sense to buy like $1,000 strike prices, okay, now they got to pay like a $300 premium for those.
And this is why I’m not this is why I put this one also in the okayish Options tab, if the if the premium was somewhat more realistic, I would have put this one into a, you know, a strong, you know, option out there that they could do.
But man, this one’s tough guys, because as soon actually, you need Tesla stock to go down to $700. Just to break even now in keep in mind in this strategy, having 6 million call options in a million dollars, or let’s say $2 million dollars and $5 million, right.
So $2 million inputs $5 million in calls, the strategy essentially is you’re looking for volatility, and you’re also looking to hedge your position a bit. So just in case you’re wrong about this, and stock goes down a bunch over the next say year and a half, you can go ahead and cash out with some, you know, some money, at least on the put option side, but man.
I got to say, you know, this is why I just put this into the okayish options, because look at $700, you need to start to go down to over the next year and a half, just to break even on the move. Okay. And remember, you’re not really trying to break even on this move.
It’s just not you know, if you’re hedging, like that would be worst case scenario is only to break even there. And then you lose all six mil, let’s say five mil six mil, it worth those call options you could sell off here today, that would be that would be just disastrous, right?
In order to accept money. You need the stock to go to $400 over the next year and a half. Not impossible. You know, everything’s possible. But man, that’s that’s tough $400 over the next year and a half just to two extra money.
That’s why I put this one into the okayish Options tab. No, out of those four options I just shared out there. Which one of those you guys like the best I would love to hear from you. But I want to share my opinion now on what I think is the best thing they could possibly do with their money right now.
This is a well thought out strategy that I was kind of thinking about. And this is kind of my opinion, double down on those 15 $100 calls as YOLO. Okay, you only live once Do you think we came to play games? we’re doubling down on those 15 $100 cost? We don’t care what they have to say, okay, we’re not just coming for the bank vault.
We’re not just coming from the money in there. Okay, we’re coming for Karen’s money to you know, she’s the bank teller. We want her $43 in her purse as well. Okay, we want the whole thing. I’m just kidding.
I’m just kidding. Okay. That might have been a you know, that’s, that belongs in a special community. Okay, that’s a W as V community right there. Okay, W SB. That’s what they would say, Okay, I’m just kidding.
Okay. The best option, in my personal opinion, what this investor could do, number five, sell all the contracts, flip the money into Tesla stock straight up. This is in my opinion, is by far the best move they can make.
I mean, they made an insane amount of money, okay, we’re talking millions on this one millions of dollars, sell out of those contracts, don’t put yourself in a time pressure situation, right? Get out of that get out of that the stress around Oh, my gosh.
I need the stock to continue to go up higher and higher and higher over the next year and a half is a tough scenario, man. And it’s no fun to be in that you did well, you to extra money in a matter of less than two months sell take the profits, flip the money into shares.
So you still have Tesla exposure and go ahead and take that 7 million to buy $7 million worth Tesla stock and ride it out for the next you know, 510 years, rather than the hope that the stock continues to go up in the short term.
Okay, in January 2022, I could see any of these prices being realistic and anywhere in between these prices, I could see Tesla’s stock being as low as $500 in January 2022, very much a possibility. Okay, if all sudden the bearish thesis comes back around Tesla overtakes the stock.
Let’s say we have a major stock market weakness, again, either a major correction or a full scale crash. And a lot of investors getting very scared margin calls coming and just you know, investors taking profits or wanting to put profits, different places, I could definitely see $500 being a possibility.
It is something you have to consider and somebody that’s even very, very bullish on the stock, you have to be realistic, and you have to at least consider the situation. The stock could be $1,000 you know, basically exactly where it’s at.
Remember, we’ve had time periods for years and years where Tesla stock will stagnate. You know, even even though there’s a lot of excitement going for Tesla’s business model, it’s happened before for four or five year periods, the stock goes up a little bit down a little bit doesn’t really go anywhere, you know, so $1,000 that’s definitely a possibility and a year and a half from now.
15 $100 definitely. possibility, okay, going up from here, that’s another, you know, 50% upward move. Definitely a possibility $2,000 also a possibility. So in my opinion in January 2022 as somebody that’s very, very bullish on the stock, but is also a realist, this stock price will be somewhere between $500.02 $1,000 In my opinion, okay.
But here’s where the issue lies at $500 at $1,000 at 15 $100 this investor loses 100% of their money remember, they need a 15 $190 just to break even on this move, okay, so anything under 15 $100 they lose 100% of that initial 3.3 mil so not only do they give up this you know, insane profit they every now let’s say 3.5 mil plus rate, but they also lose their initial $3.3 million.
Okay, and this is why I think it is just ludicrous, in my personal opinion, to keep those call options open man, close them out, buy the shares, hey, if the shares go up a bunch Guess what, you’re still gonna make a ton of mine I mean.
If you got $7 million worth of Tesla stock and Tesla stock goes to $2,000 which is a little over a double up from here right you know, you’re 14 mil it’s just not worth the risk in my personal opinion of keeping these call options open now at this point in time because literally like like this stock could easily stagnate for a time period.
Just went on a massive run where went from under $200 what to you know $1,000 in a matter of a year has been on a massive run so it could easily stagnate it could easily go down also for the next year or so you know.
Based upon let’s say the market gets super weak that’s definitely a possibility Okay, and these are all things you have to consider and at the end of the day it does not make sense at all for this individual my opinion to keep these call options open close them out, take your sick profit and put the money into Tesla stock Yeah.
You’re gonna have to pay your taxes on it and that’s unfortunate but hey, that’s one of the things when you make a lot of money guess what you got to pay a lot of taxes it’s just the way it goes Okay, and let’s the Fed can just start like printing our tax money think about you know, as the Fed can just print all this money maybe they can just like print our tax money Nah.
It’s probably not gonna work. Okay, so anyways, I hope you guys really enjoyed this video very much here today. Let me know what option you guys think is best and maybe you have something else you think they should do instead of these five.
I would love to hear from you guys in that comment section. As always, I hope you learn from this video. Don’t forget to smash the thumbs up. Thank you for watching. Have a great day.