I would go further out of the money to reduce risk. With 72 days to expiration you could very likely be forced to exit one side of your strangle. I would consider legging in to a 75/125. Sell the 75 Puts on a down day and sell the 125 Calls on an up day. Just my opinion. r
Last edited by Raven; May 7th, 2014 at 11:04 AM.
Reason: corrected bad grammar
This is an interesting spread and possibly takes advantage of CL volatility rising. You obviously see CLQ trading closer to either 105 or 92 in the near term. Either will give you profit. With a tight range you limit your loss to the debit of $150 and look for a profit of $3000. The great risk is if CLQ has a larger move below 90 or above 106 within a shorter time frame. With CL vol so low I have been starting to look again at NG. But your proposed trade is interesting. The 105 and 92 targets are within the current larger trading range. Thanks for this and I will run it through my option analysis.
NG is a very tight market ( many manipulators) based in USA instead of CL based in hole world ) . look at recent days when CME rised margin in NG just as they wanted. many traders had margin calls even being in a good position. i know some of them.
Well, here I am thinking low vol in CL is not doing me any favours and it might be time to look again at NG. So I have been looking at the XLS SPAN work done by the team and took my thoughts for run through the progam. Here are the results.
Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).
Thank you some much Dudetooth for your great work and all the others who contributed to this fantastic piece of work. I am sure I have just started on another learning curve thanks to your great efforts.
The following user says Thank You to BlueRoo for this post: