How to trade Tesla options
Tesla options are popular financial derivatives, with many traders seeking to get exposure to Tesla’s share price movements. Here, we explain what Tesla options are, how much they cost and how to trade Tesla options.
What are Tesla options?
Tesla options are a financial derivative which enable you to trade Tesla stock at a set price (known as the strike price) before a predetermined date (known as the expiry). There are two main types of options to trade: calls and puts.
If you thought the market was going to rise, you’d buy a Tesla call option, but if you thought the market was going to fall, you’d buy a Tesla put option. In both cases, you have the right but not the obligation to buy Tesla shares at a set price, before a predetermined date.
Alternatively, you could sell Tesla call options or put options. You’d sell a Tesla call if you thought the price of Tesla shares was going to fall, and you’d sell a Tesla put if you thought the price was going to rise.
As the seller of a call option, you have the obligation to sell the underlying at the strike price if the buyer executes their right to buy. As the seller of a put option, you have the obligation to buy the underlying market at the strike price if the buyer exercises their right to sell.
Please bear in mind that selling options carries an inherently higher risk than buying them.
Learn more about trading options
With IG Bank, you can trade CFDs on an option’s price. You never risk more than your initial payment when buying a call or put option, and you never need to deliver or take delivery of the underlying shares.
How much would it cost to trade Tesla options?
At IG Bank, we offer weekly, monthly and quarterly pricing on share options. Their prices are determined by the price feed of an option exchange, around which we wrap an IG Bank spread. Our spreads can often be tighter than those offered in the underlying market.
How to trade Tesla options
Share options are available with IG Bank through our phone dealing service. This means to trade Tesla options, you’ll need to call us. Before calling to place a deal, consider the time frame of your Tesla option – IG Bank offers weekly, monthly and quarterly contracts for share options.
IG Bank also offers options on other markets directly through our online trading platform – including forex, indices and commodities. Follow the steps below to get started:
- Create an IG Bank trading account
- Learn about trading options
- Research the market you’d like to trade
- Take steps to manage your risk and learn about options Greeks
- Open, monitor and close your first position
The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer.
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