How to trade Tesla options
Tesla options are financial derivatives popular with traders who are seeking to get exposure to Tesla's share price movements. Here, we explain how to trade Tesla options and what they are.
How to trade Tesla options
You can trade Tesla options with a US options and futures account, a spread betting account or a CFD trading account. With listed options, you can trade pure-form options contracts, and with spread bets and CFDs, you'll be speculating on the price of Tesla options rather than buying or selling them directly.
Not owning the contract gives you a range of tax benefits,1 and it also means you won’t ever need to take delivery of the underlying asset that the option represents. Follow the steps below to get started:
Decide whether you want to trade listed options, spread bets or CFDs
Choose the Tesla option you want to trade according to its strike price, expiry and whether it's a call or a put
- If you're trading listed options, type 'TSLA' or 'Tesla' in the top panel and select 'options' under asset type- If you're trading spread bets or CFDs, go to 'options' on the left-hand menu and filter by shares to see Tesla
Open, monitor and close your position
In addition to Tesla options, we offer listed options on a diverse range of stocks, exchange-traded funds (ETFs) and indices. Plus, you can trade over-the-counter (OTC) options (ie trading via spread bets and CFDs) on indices, forex, commodities and shares. Note that with OTC options, you won’t be trading the options contracts directly.
If options trading isn’t for you, we also offer spread betting and CFD trading on a range of other markets – including Tesla shares. These products enable you to speculate on prices rising by going long or falling by going short.
What are Tesla options?
Tesla options are financial derivatives that enable you to trade Tesla stock at a set price (known as the strike price) before or on a predetermined date (known as the expiry). There are two main types of Tesla options to trade: Tesla calls and Tesla 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’d have the right but not the obligation to buy Tesla shares at a set price, before or on 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 exercises 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 us, you can trade listed options, or spread bet or trade CFDs on an option’s price. With these products, you’ll never risk more than your initial payment when buying a call or put option. With listed equity options, delivery of shares is possible if the option expires in the money, but with spread bets and CFDs on options you never need to deliver or take delivery of the underlying shares.
How much would it cost to trade Tesla options?
How much it costs to trade Tesla options depends on whether you choose – for example – 0DTE, weekly, monthly or quarterly options. Their prices are determined by the price feed of an options exchange, around which we wrap our spreads if you’re trading via spread bets or CFDs – which can often be tighter than those offered in the underlying market.
Footnotes:
1 Tax laws are subject to change and depend on individual circumstances. Tax law may differ in a jurisdiction other than the UK.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material 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 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. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research 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 and quarterly summary.
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