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Options traders set to cash in on Tesla's big delivery beat

Options traders bet on Tesla shares to hit the 'gas'

Tesla's huge Q2 delivery beat is glorious news for plenty of bullish options traders, who look set to cash in after the electric automaker crushed expectations.

Tesla says it delivered about 90,650 vehicles in Q2, beating analyst expectations of 72,000, and the stock has responded by surging to yet another all-time high. 

For one group of options traders, a big bet on a deliveries beat is looking likely to pay off in a huge way.

"We saw calls outpace puts significantly, by about 2-to-1 on above-average volume today, and most of that activity was concentrated in very short-dated call buying. Specifically, the most active options were the weekly 1,200-calls," Optimize Advisors CIO Michael Khouw said Wednesday on "Fast Money."

Those contracts expire Thursday, and were trading for an average of $3.50 per contract in Wednesday's session. That puts the break-even level at an underlying stock price of $1,203.50 at expiration, but it's not the only way that these traders can make money in these contracts.

After trading at an average price of $3.50 on Wednesday, those contracts are trading for an average price of about $11 as of 11 a.m. ET on Thursday. That means that instead of holding the contracts to expiration and exercising their right to purchase Tesla at $1,200 per share, these traders can simply turn around and sell these contracts back onto the market for a hefty profit of about $7.50 per individual contract, or $750 in a standard block trade worth 100 shares of stock. 

Tesla was trading about 7% higher in Thursday's session. 


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