Rolling TSLA Call Bear Spread: Increased Risk, New Expiry Date, and a Hedging Strategy | June 2023 Trade Update

On June 7th, 2023, for the second time this month already, I rolled up and rolled forward 1 call bear spread on TSLA stock turning it into a call ratio backspread with a new expiry date on June 26, 2023.

I was holding a 220/230 call bear spread with June 16th expiry, but as TSLA cracked 220 and even threatened to go over 230, I was left with no other options than to close this position with a huge loss or try to roll out and close this position with a smaller loss.

I opted for rolling, thus this also means I increased the risk. Significantly.

here is the trade setup:

• BOT 1 TSLA JUNE 16 '23 220 Call Option 12.59 USD

• SLD 1 TSLA JUNE 16 '23 230 Call Option 7.01 USD

• SLD 1 TSLA JUNE 23 '23 255 Call Option 2.44 USD

• BOT 2 TSLA JUNE 23 '23 300 Call Option 0.35 USD

Here I bought back the 220/230 strike spread and sold a new call ratio backspread with strike prices at 255 and 300 with expiry on June 23, 2023. 

The aftermath of this trade is -$388 (if options expire worthless)

Additionally, I sold a put bull spread to hedge this position and recover some losses:

• SLD 1 TSLA JUNE 16 '23 215 Put Option 2.60 USD

• BOT 1 TSLA JUNE 16 '23 200 Put Option 0.63 USD

In case put spread will expire worthless, I will book:+$195 in options premium

What happens next?

Now to keep this trade under control TSLA should trade above 215 and under 255 by June 23.

• In total: 20 trades since April 18, 2023

• Options premium: -$68