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Selling Options on Futures?
Started:July 19th, 2011 (06:16 PM) by ron99 Views / Replies:568,200 / 5,727
Last Reply:December 2nd, 2016 (12:40 PM) Attachments:642

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Selling Options on Futures?

Old October 30th, 2013, 09:28 PM   #2291 (permalink)
Trading for Fun
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TY or US

What is the general consensus here? What are the advantages and disadvantages of trading one or the other?

Sorry for posting such a newbie question.

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Old October 30th, 2013, 09:32 PM   #2292 (permalink)
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BlueRoo View Post
What is the general consensus here? What are the advantages and disadvantages of trading one or the other?

Sorry for posting such a newbie question.

They are highly correlated. I look for the best ROI, whether it be in US or TY.

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Old October 30th, 2013, 11:13 PM   #2293 (permalink)
Market Wizard
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BlueRoo View Post
So if the margin in the trade calculator is incorrect in OX then the margin in your account balances must also be incorrect. I don't see a difference between them.

Correct.

I ignore their margin and use my own calculated with SPAN and allowing for their increased margin on some commodities.

As stated in the emails I received from OX, they will overule the computer limiting trading. BUT you have to talk to the right person or else you will get the run around from them.

But most of the time I am not close enough to a margin call for this to be a problem.

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Old October 31st, 2013, 02:02 AM   #2294 (permalink)
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MARGIN NIGHTMARES!

Ron, This is freaking me out. I can't believe that for the last few years I have been trading believing the marging requirement listed in the OX account balances and trade calculator. THIS HAS TO BE A SERIOUS IF NOT FRAUDUALENT and MISLEADING ACT ON THEIR BEHALF. Or it certainly would be in Australia.

Ron would you please do me a big favour and let me know what the margin should be on the following CL strangle please.

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Old October 31st, 2013, 08:59 AM   #2295 (permalink)
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Futures Edge on FIO

BlueRoo View Post
Ron, This is freaking me out. I can't believe that for the last few years I have been trading believing the marging requirement listed in the OX account balances and trade calculator. THIS HAS TO BE A SERIOUS IF NOT FRAUDUALENT and MISLEADING ACT ON THEIR BEHALF. Or it certainly would be in Australia.

Ron would you please do me a big favour and let me know what the margin should be on the following CL strangle please.

Ron has previously mentioned a workaround for this.

If you subtract the Tradecalc margin value for one spread from the Tradecalc value for two spreads this will give the real value per spread. So in this case $1,367.52 - $1,112.76 = $254.76 per spread. So that would be $25,334.00 for the 100 spreads in your example.

I make that about 5% ROI per month.

HTH

Chris

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Old October 31st, 2013, 09:38 AM   #2296 (permalink)
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Actually $25,476 for 100.

Also the Profit/Loss column in the top right is wrong. The decimal point is off two places to the right.


Last edited by ron99; October 31st, 2013 at 09:45 AM.
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Old October 31st, 2013, 06:06 PM   #2297 (permalink)
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Interesting how the monthly ROI% for a CLg4 p70 c125 strangle is better than the ROI for a CLg4 p75 c125 strangle.

5.3% vs 4.7%.

Lower risk on put and better ROI.

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Old October 31st, 2013, 06:15 PM   #2298 (permalink)
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ron99 View Post
Interesting how the monthly ROI% for a CLg4 p70 c125 strangle is better than the ROI for a CLg4 p75 c125 strangle.

5.3% vs 4.7%.

Lower risk on put and better ROI.


When you enter these orders, do you leg in, or enter it as one order? I've tried a couple of times as one order, and find it really tough to get a fill (this was in Gold, though). Seems like legging in would be easier, although maybe it is because I'd end up giving up a bit on the price.

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Old October 31st, 2013, 06:22 PM   #2299 (permalink)
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Size of losses.


ron99 View Post
It would be (SPAN Margin +loss in position) approaches 3 * IM .

500 IM times 3 = 1500.

This seems like a very workable exit strategy. The only question I have is that with this exit the loss that might be taken seems to be fairly large compared to the max gain that could be made for the position. Is this exit strategy positioned to increase the probability that the position will result in success? Is this the best choice of
"wiggle room "to allow the underlying to move and result in the higher probability of gain?

thanks again HH.

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Old October 31st, 2013, 06:31 PM   #2300 (permalink)
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kevinkdog View Post
When you enter these orders, do you leg in, or enter it as one order? I've tried a couple of times as one order, and find it really tough to get a fill (this was in Gold, though). Seems like legging in would be easier, although maybe it is because I'd end up giving up a bit on the price.

I don't think I have ever did a strangle as one order. Always have legged in. I am too far OTM to get decent bids for a strangle.

Also I tend to put on puts on down days and then put on calls on up days.

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