Tesla Stock Surges But Could Still Rise From Here - Best to Short OTM Put Options

Tesla Inc (TSLA) stock is up over 44% in the last month and 145% YTD. TSLA stock is up again on Tuesday, June 20, at $263.90 in morning trading on June 20, after a long weekend. However, the stock could still rise based on its historical multiples and with good earnings. This makes shorting out-of-the-money (OTM) puts an ideal strategy for conservative investors.

We discussed using options to buy TSLA stock in our last article on Tesla on May 31, “Unusual Options Activity In Tesla Stock Shows A Large Investor Taking A Position.” We pointed out that a large investor had likely bought a huge amount of long-dated call options (expiring Oct. 20) at the $310 strike price for just $5.15 per call. Today those calls are trading at $21.18 per call option. That is a massive gain of 311% for the investor in just 20 days of trading.