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Selling Options on Futures?
Started:July 19th, 2011 (06:16 PM) by ron99 Views / Replies:570,062 / 5,734
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Selling Options on Futures?

Old May 8th, 2013, 02:37 PM   #1561 (permalink)
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eudamonia View Post
Pardon my ignorance but how do you know or why do you suspect that this is an iceberg order?

Because I placed an order to sell for more than were bid and I was immediately filled and more were bid.

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Old May 8th, 2013, 02:39 PM   #1562 (permalink)
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ron99 View Post
Because I placed an order to sell for more than were bid and I was immediately filled and more were bid.

Doesn't that scare you that someone, possibly with deep pockets, think the other side of you trade is a great deal?

If you have any questions please send me a Private Message or use the futures.io "Ask Me Anything" thread
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Old May 8th, 2013, 02:41 PM   #1563 (permalink)
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ron99 View Post
Because I placed an order to sell for more than were bid and I was immediately filled and more were bid.

Same here. I sold 40 which was all that was bid and 50 more showed up soon afterward.

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Old May 8th, 2013, 02:46 PM   #1564 (permalink)
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kevinkdog View Post
Doesn't that scare you that someone, possibly with deep pockets, think the other side of you trade is a great deal?

I definitely thought about that. Am I missing something? I read up on the most recent reports. There is a concern about Roya but that comes up every year and is usually over blown. I figured if there is an issue, KC may spike up maybe 50 - 70 points. We are talking way out of the money at 300 vs 145.

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Old May 8th, 2013, 03:00 PM   #1565 (permalink)
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ron99 View Post
For those of you who missed selling KCu3 300c they are bid at 0.14. Looks like an iceberg order.



Hmmmmm...I see zero Vol and zero OI today for those.

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Old May 8th, 2013, 03:05 PM   #1566 (permalink)
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opts View Post
Hmmmmm...I see zero Vol and zero OI today for those.

I bet you are looking at Aug instead of Sep.


Last edited by Raven; May 8th, 2013 at 03:17 PM.
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Old May 8th, 2013, 03:15 PM   #1567 (permalink)
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Raven View Post
I bet you are look at Aug instead of Sep.




Ohhhhhh....smartypants!

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Old May 8th, 2013, 03:31 PM   #1568 (permalink)
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kevinkdog View Post
Doesn't that scare you that someone, possibly with deep pockets, think the other side of you trade is a great deal?

Just about every trade done has someone on the other side thinking you are wrong and they are right.

Not everyone that is buying options is looking to make money on them. Some are just buying them for insurance in case something happens. They actually hope they don't make money on them.

If you buy flood insurance you hope you never have to collect on it.

Or some are buying to remove the unlimited risk of selling lower strikes and make their frightened brokers happy.

A year ago today Sep KC was 177.30. The 300 call was 0.20 and OI for it was 4889. The highest settlement for the futures after that was 188.95. But OI for the 300 call had grown to 7,408 on June 25th.

The call got up to 0.31 and OI that day was 7,137 but OI barely dropped after that (to 7,048) and finished on expiration day at 7,253. So very few of those buyers of calls tried to take the profit offered to them. Instead they rode to expiration.

Sep 2012 KC futures were 151.05 on 6/14/12 and the 300 call was 0.13.

On 7/19/12 the futures were 188.95 but the 300 call was at 0.06. Futures went up by 25% but you made money on the call in that time frame because they were so far OTM and they were close to expiration.


Last edited by ron99; May 8th, 2013 at 03:37 PM.
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Old May 8th, 2013, 08:21 PM   #1569 (permalink)
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Do you have any tips on how to search for these "deals" such as the Sept coffee? Do you do a manual search of so many markets every day, setup a database, or something else?

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Old May 9th, 2013, 10:46 AM   #1570 (permalink)
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I just use manual to look up "deals"

I used to have a spreadsheet linked to my data provider. I would list on the spreadsheet the contracts that I would trade. I would then have a column that compared the bid to the prior day settlement. It would factor in the amount that futures were up or down times the delta. It would turn the font green if the bid was higher than the factored price. I would then just have to look for green font to see what looks good.

I quit doing that because it was just too unwieldy to have that many contracts on a spreadsheet and to keep changing the contracts to be linked. I may start to do it again if I have time to set it up. But someone could still do that if they wanted to.

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