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Selling Options on Futures?
Started:July 19th, 2011 (06:16 PM) by ron99 Views / Replies:568,987 / 5,728
Last Reply:20 Hours Ago (05:26 PM) Attachments:642

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Selling Options on Futures?

Old August 10th, 2013, 11:32 AM   #1881 (permalink)
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kevinkdog View Post
Can you reveal roughly what percentage of you account margin was tied up with KC? Do you have some rule for the maximum per instrument? I ask because I am allotting 15% max to each instrument, but maybe I am too conservative, or maybe too risky.

I do not have a maximum. I base number of contracts on my opinion of the safety of the contract. Since I viewed KC 300+ calls as extremely low risk, I did not limit the number of contracts. I did put on less 200 calls because it was more risk.

But I do not have a hard rule for this.

I have about 1,500 contracts on now. So 57% of my contracts were KC. But the margin on the 300+ was very low. So the percentage was less than 57%. I don't know the exact number.

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Old August 11th, 2013, 05:23 AM   #1882 (permalink)
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Hi Ron,

When you are looking to sell CL options, what sort of DTE do you generally start looking at?

Regards,

bakes

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Old August 11th, 2013, 12:06 PM   #1883 (permalink)
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Bakes View Post
Hi Ron,

When you are looking to sell CL options, what sort of DTE do you generally start looking at?

Regards,

bakes

Throwing my 2 cents in here because CL makes up the bulk of my options selling....

I look at 30 to 50 DTE and about $30 or more away from the underlying on both sides; puts and calls. Looking to bank no less than $30 per option. You have to be careful selling calls in this market because of the ever-present Middle East volatility factors that can erupt over night. I tend to sell calls when the market seems to have already made a high or some king of pull-back in a downtrend. I would strongly suggest not selling calls below 120 or puts above 75. We had a large move up on Friday and calls can get inflated more next week pending any further move up. Keep an eye in tropical storm/hurricanes in the Gulf of Mex this time of year. Strorms will shut down oil platforms and prices go....up. Lots of recent news saying oil too high and must go down. That's been "said' for over a month and look where prices are now...haven't come down too much. So, I haven't sold puts in a while, only calls above 130.

Selling the puts in the 75 area is a good 'location[' to keep an eye on.

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Old August 11th, 2013, 02:32 PM   #1884 (permalink)
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Question

Hi everyone,

I traded options for about four years before switching to daytrading futures in Jan of this year. I just bought calls and puts on stocks that moved well (like bidu).

I am much better at techical analysis than I used to be and I want to take advantage of some swing trades on Oil and gold but I am seeing the spreads are ridiculous.

Does anyone know the best instruments to buy calls and puts on for oil and gold that would have the tightest spread and good volume? Would it be "oil" and "gld" or are there better choices out there?

Thanks alot for your help

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Old August 11th, 2013, 08:16 PM   #1885 (permalink)
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Bakes View Post
Hi Ron,

When you are looking to sell CL options, what sort of DTE do you generally start looking at?

Regards,

bakes

I look at 60-90 DTE for puts and 45-60 DTE for calls because time erosion is slower on calls.

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Old August 11th, 2013, 08:18 PM   #1886 (permalink)
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dnkhoward2 View Post
Hi everyone,

I traded options for about four years before switching to daytrading futures in Jan of this year. I just bought calls and puts on stocks that moved well (like bidu).

I am much better at techical analysis than I used to be and I want to take advantage of some swing trades on Oil and gold but I am seeing the spreads are ridiculous.

Does anyone know the best instruments to buy calls and puts on for oil and gold that would have the tightest spread and good volume? Would it be "oil" and "gld" or are there better choices out there?

Thanks alot for your help

Hi, this thread is about option on futures. You look to be wanting to do ETF options.

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Old August 11th, 2013, 08:35 PM   #1887 (permalink)
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Hi ron99,

I trade futures and I would like to trade the options on the futures instruments I like to trade but like I said the spreads are too large. I thought my question might be applicable here but obviously not. Just disregard my question.

Thanks anyway

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Old August 12th, 2013, 12:28 PM   #1888 (permalink)
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The OI on KC options dropped from 201k to 101k with the expiration of the Sep options. 50%!!!

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Old August 12th, 2013, 05:32 PM   #1889 (permalink)
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LH V3 75P

a trade I like with respect to rr (not sure how it compares to OX re margin requirements).......



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deltas on the right hand side (with bull spread also inc - i have small bullish bias using technicals)......

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a 1 std. dev move over this 2 mth period is approx 5, if i have calc it correctly (price x HV x sq root of DTE / sqr root of working days in yr), though i am using HV instead of IV as i cannot seem to find IV on IB.

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Old August 12th, 2013, 05:39 PM   #1890 (permalink)
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LHV375P, with a current price of 0.2, has Options Express Initial Margin of $350. That equates to a 3.33% monthly ROI, which is pretty good. At a price of .15, the ROI drops to 2.44%, a decent return.

LHV3 futures are up about 1.00 today, so those figures will change overnight...

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