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Selling Options on Futures?
Started: by ron99 Views / Replies:584,311 / 5,779
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Selling Options on Futures?

  #1691 (permalink)
Market Wizard
Cleveland, OH
 
Futures Experience: Advanced
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lapuente2002 View Post
I only trade futures, but I am very interested in trading options on futures

Welcome and good luck.

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  #1692 (permalink)
Trading Apprentice
Orlando Florida
 
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ron99 View Post
Where do you get historicalvol, UnZane?

You can also use implied volatility

This link can help you calculate
lol - imagine a link here for you ron - I have to post another three post before I can share


Let me know if it makes sense. Any heartburn of the notional value of your account and leverage?

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  #1693 (permalink)
Trading Apprentice
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ron99 View Post
Welcome and good luck.

Yes good luck

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  #1694 (permalink)
Trading Apprentice
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rosho01 View Post
interesting comparison between miles driven (US) and S&P....

Interesting!

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  #1695 (permalink)
Trading Apprentice
Orlando Florida
 
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Futures Edge on FIO

Which products do you trade?

 

UnZane View Post
You can also use implied volatility

This link can help you calculate
lol - imagine a link here for you ron - I have to post another three post before I can share


Let me know if it makes sense. Any heartburn of the notional value of your account and leverage?

Lets try this again
http://www.cmegroup.com/market-data/datamine-historical-data/methodology.html

It worked! I calculate it both ways

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  #1696 (permalink)
Elite Member
London/UK
 
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ron99 View Post
Where do you get historicalvol, UnZane?

historical & implied vols are provided by some brokers - IB have it.

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  #1697 (permalink)
Market Wizard
Cleveland, OH
 
Futures Experience: Advanced
Platform: QST
Broker/Data: QST, DeCarley Trading, Gain
Favorite Futures: Options on Futures
 
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  #1698 (permalink)
Market Wizard
Cleveland, OH
 
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Favorite Futures: Options on Futures
 
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Here is how not to trade.

Quoting 
The (CFTC) Order finds that from January 1, 2008 through March 1, 2009, FCStone failed to diligently supervise its officers’ and employees’ activities relating to risks associated with its customers’ accounts, and with the Account, which was primarily controlled by two individuals who traded natural gas futures, swaps, and option contracts.

Because FCStone did not have adequate credit and concentration risk policies and controls, the two Account owners accumulated a massive position -- more than 2.5 million relatively illiquid commodity option contracts, which the Account owners could not afford to maintain. After the value of the positions deteriorated over the course of 2008, the Account owners were unable to meet their financial obligations with respect to the Account.

As FCMs are required to do in that situation, FCStone assumed the financial obligations to the clearing house that carried the positions. Unable to successfully manage the positions, FCStone ended up suffering $127 million in losses. The Commission found that FCStone violated Regulation 166.3 by failing to diligently supervise in a manner designed to mitigate risks associated with customer accounts, such as the risks arising from unsatisfied margin obligations, negative account balances, and the handling of large relatively illiquid positions.

CFTC fines FCStone LLC $1.5 million for lax account supervision

I was trading at FC Stone when this went down. They freaked out. They went from allowing these guys 2.5 million positions to telling me I couldn't have 10 far OTM short options in a 15k account. I closed all accounts there after that.

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  #1699 (permalink)
Market Wizard
Cleveland, OH
 
Futures Experience: Advanced
Platform: QST
Broker/Data: QST, DeCarley Trading, Gain
Favorite Futures: Options on Futures
 
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Thanks: 650 given, 4,036 received
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Here's a good example of why I don't trust anything that Phil Flynn (energy analyst) says.

He wrote,

"according to an Energy Information Administration-sponsored study released today. “Technically Recoverable Shale Oil and Shale Gas Resources" estimates that shale resources considered in conjunction with EIA's own assessment of resources within the U.S. indicate technically recoverable resources of 345 billion bbl of world shale oil and 7,299 Tcf of world shale gas."

So according to that number and assuming the world consumes 19 million barrels of oil per day, we then have 497 years of oil left or .04974765681 if you want to get technical."


I emailed him and said,

345 billion divided by 19 million is 49.7 years not 497 years.

But world oil consumption is 87 million bpd not 19. Where did you get 19?

He replied,

U r right

Thanks,

Phil Flynn
The PRICE Futures Group

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  #1700 (permalink)
Trading Apprentice
west palm beach + Florida
 
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ron99 View Post
Here's a good example of why I don't trust anything that Phil Flynn (energy analyst) says.

He wrote,

"according to an Energy Information Administration-sponsored study released today. “Technically Recoverable Shale Oil and Shale Gas Resources" estimates that shale resources considered in conjunction with EIA's own assessment of resources within the U.S. indicate technically recoverable resources of 345 billion bbl of world shale oil and 7,299 Tcf of world shale gas."

So according to that number and assuming the world consumes 19 million barrels of oil per day, we then have 497 years of oil left or .04974765681 if you want to get technical."


I emailed him and said,

345 billion divided by 19 million is 49.7 years not 497 years.

But world oil consumption is 87 million bpd not 19. Where did you get 19?

He replied,

U r right

Thanks,

Phil Flynn
The PRICE Futures Group

The numbers just don't make sense here.... 345 billion = 345,000 million which divided by 19 million (or 87 million for world demand) comes to 18157.89 years (or 3965.52 years in case of 87 million).

I do not ever remember reading in any article related to oil mentioning about more than 100 or 200 years of oil supply in world left to extract. Per these numbers US alone has more than 3900 years of oil supply for entire world....WOW...

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