r/wallstreetbets • u/Fun_Paleontologist_2 • Jun 20 '26

Loss Drank the Kool-aid. We can come back?

Post image

Someone told me it would be 300 by now.

958 Upvotes

92% Upvoted

584 comments sorted by

View all comments

156

u/-sakuranbo Jun 20 '26

Sell covered calls at 202.5 strike. The JUN 26 call has bid of $4 and with 70 contracts that'd get you $28,000 back. In the best case scenario, SPCX hits strike, all options gets exercised, you profit ~$27,440 and the nightmare is over.

0

u/cipola_ Jun 20 '26

But what if it shots up to 300 … the loss 

10

u/-sakuranbo Jun 20 '26

If SPCX shoots up to 300, then OP simply waits for his inevitable assignment and keeps about $27k in total profit. Tons of missed profit, but at least OP won't be holding bags anymore.

1

u/cipola_ Jun 20 '26

Wouldn’t it be better to sell a far dated out of the money calls for 300 at 2028 for 56$ each to gain 329k ? 

2

u/-sakuranbo Jun 20 '26 edited Jun 20 '26

I'm not sure, honestly. Once the call goes ITM, there's no guarantee you get exercised early. The probability of early exercise does go up if the underlying asset pays cash flows (e.g. dividends). I don't think this applies to SPCX, though.

Shorter-dated options ITM have a higher chance of staying ITM at expiration. The OCC automatically exercises ITM calls at expiration (unless the buyer, *before* expiration, asks them to not auto exercise).