This TSLA Debit Call Spread Could Turn 56% Profit in 12 Days
Bullish play with a target stock price of $280 or above
Strategy has +56% upside potential and 3% undervalued
| Expiration | 22-Nov-24 |
| Buy | 275 Call |
| Sell | 280 Call |
| Debit: | $3.20 |
Option Profit Calculator for TSLA Call Spread at 22-Nov-24 Expiration
If TSLA stock price at expiration is at or above $280.00, this spread has a 56% upside potential
The optimal stock price for this option strategy is to close at or above $280.00 on the expiration date, November 22, 2024. In that scenario, both calls would be in-the-money, so the spread would be worth the maximum value of 5.00. That would equate to the potential upside of +56% for this call spread with 12 days left to expiration.
The maximum gain will be realized if the stock price is at or above 280.00. The maximum gain is $1.80
The breakeven point is at 278.20, which is 3.7% below the current spot price.
The maximum loss will occur when the stock price is at or below 275. The max loss is $3.20.
TSLA Spread Current Market Price vs. Historical Average
TSLA Call Spread is trading at a 3% discount to historical average.
Using historical data to measure how a similar spread in TSLA was priced in the market, the 4-year average value was 3.30, with a high mark of 3.95 and a low of 2.98.
Currently, this vertical call spread is bid at 2.95 and offered at 3.20. The midpoint of the spread is 3.07.
If we use 3.30 as our historical fair value benchmark, the current market ask price is at a 3% discount, while the current market midpoint represents a 7% discount.
| Current Price | Historical Values of Similar Spreads | ||||
| Bid | Ask | Midpoint | Average | High | Low |
| 2.95 | 3.20 | 3.07 | 3.30 | 3.95 | 2.98 |
Takeaway
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