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r/thetagang
Selling SPCX long-term options, huge premium
Investor summaryNeutral
Author plans to sell SPCX straddles to capitalize on its high IV and expected rangebound price action, comparing it to NVDA.
Bull points
- High market cap of $2 trillion provides significant stability and downside protection.
Bear points
- Massive size severely limits upside potential, making substantial price increases unlikely.
Post body
SPCX has an IV of 80, which is among the highest of any individual stock
But it's worth $2 trillion, so this means it's probably more stable than the majority of small companies. $2 trillion is a huge market cap , so there is a lot of inertia keep it propped up. I am planning on selling straddle that expire in 6 months, with some of the underlying to keep the delta positive a bit . This takes advantage of what I expect rangebound trading. At $2 trillion SPCX is too big to go up much more, but also will not fall much either, similar to NVDA which has been in a $40 range for the past 2 years.
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