The great mystery of Tesla’s share price continued on 6th Jan as it dropped for 3rd day in a row. After jumping 13% on 3rd Jan, fuelled by the excellent Q4 delivery numbers, Tesla’s share has lost all its gain after the last 3 trading days.
My unrealized gains on my Jan 23 Tesla LEAPS have also dropped significantly from their 100% returns just a few days ago. In my last 2 trading days, I have bought 2 more Tesla LEAPS at premiums of $2950 (before the stock price crashed on 5th Jan) and $2100 yesterday when the stock fell again. I own a total of 10 Tesla LEAPS now (5 x Sept 22, 3 x Jan 23, 2 x Jan 24).
I have a strong conviction that Tesla’s share price will rebound soon, especially when they are going to announce their Q4 earnings and CEO Elon Musk will be there to talk about new product launches. Also, the 2 new gigafactories in Berlin and Texas, together with the expansion plan of Shanghai gigafactory, will mean Tesla is going to ramp up production and break new records of car delivery numbers in 2022. If the share price continues to fall, I will source more funds to buy more Tesla LEAPS positions, because I think this is a good opportunity to accumulate more LEAPS contracts before the share price skyrockets again. Do check out Tesla stock technical analysis here.
My Biggest Loser
In order to fund my latest Tesla LEAPS purchase, I had to sell away the biggest loser of my trading journey so far, that is Watt Disney.
I have been such a huge fan of Watt Disney, especially the Marvel comic franchise (Iron Man, Spiderman, Captain America). Their movies were box office hits, so were their theme parks, until the pandemic changed everything. Disney managed to grow their Disney+ channel fast during the pandemic but it was slowing down in subscribers growth. Coupled with Omnicron spreading rapidly across the world and more restrictions coming up, I believe Disney’s fortunes were not likely to change in the near future.
I first bought this Disney LEAPS on April 21 and it was a deep ITM, with a delta of 0.91, strike price of $120 when Disney was trading at $188. I paid a premium of $7,550. I bought deep ITM LEAPS because I was just starting out on LEAPS and followed the advice of the options experts to buy ITM LEAPS to capture both intrinsic and extrinsic value. I later found out that OTM LEAPS allow me to earn more and have a lesser risk of being stuck when the trend reverses. When I sold the LEAPS at $4,150, I suffered a 45% loss on this LEAPS. Previously I also suffered a 3k loss when I exited the Wheel Strategy on Disney, to free up the capital to buy other big tech counters. Disney, together with my Bank Of America stock, was my way of diversifying out of the big tech but I suffered a huge loss as a result. I am still left with 3 Disney LEAPS which I bought at a lower price when Disney was trading around $160 and I hope these LEAPS gave me good returns to offset my loss.
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Keen to learn about options trading but do not wish to pay for expensive courses, this newbie guide will help gain the knowledge and fundamentals to understand options better. And it’s totally free!
The Newbie’s Guide To Options Trading
The LEAPS Strategy has helped me make more than USD120,000 in 2021. Here’s all you need to know about this strategy that can help you increase your wealth exponentially:
The Ultimate LEAPS Options Thread
Looking for ideas on what stocks to invest in or which stocks to trade? You can take reference from what I have been buying or selling. I try to update them as soon as I can in this section, as well as share my thoughts behind executing these trades:
MY TRADES
Excited to start your trading journey or perhaps try out with a paper trading account to build your confidence in trading? Check out this step-by-step to help you get started:
How To Buy Options on Interactive Brokers (Step-By-Step)
I watched tons of videos on YouTube since 2020 and if you are wondering if there are any useful channels that you can subscribe to for learning market trends, TA, FA, check out this compilation here:
My Secret Weapons For Options Trading: I Watch These YouTube Financial Channels Every Day
I concluded my first year of options trading with more than USD160k of gain, see how I do it and the capital I use for every month to give you a sensing of the percentage yield I get out of my gains:
1st Year Options Trading Recap: The Journey Towards SGD$217,509 Profits In 2021
This blog is as authentic and as transparent as I can share, I do not just show the wins and hide the loss. I have made some very bad decisions in the first 8 years of investing and paid a huge price for them. Here is the loss I have accumulated during these years. I hope you learn some lessons from my mistakes.
I Cut $135,715 Worth Of Losses In The Last 1.5 Months
Learning Investment With Jason Cai 