Tesla Stock Enters Into A Sharp Correction; Here’s How To Create A Bear Call Spread

Tesla (TSLA) has been declining since early April. Plus, the stock has slumped below the 21-, 50- and 200-day moving averages. Let’s look at how to set up a bearish option income trade, called a bear call spread.




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A bear call spread in Tesla stock involves selling an out-of-the-money call option and buying a further out-of-the-money call.

The strategy can be profitable if the stock trades lower, sideways, and even if it trades slightly higher — as long as it stays below the short…

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