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Selling Options on Futures?
Started:July 19th, 2011 (06:16 PM) by ron99 Views / Replies:569,792 / 5,734
Last Reply:23 Hours Ago (01:01 AM) Attachments:642

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Selling Options on Futures?

Old August 24th, 2015, 03:06 AM   #4811 (permalink)
Market Wizard
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SMCJB View Post
12.11am
ESU5 ~ 1914
V Wing Vol looks like its ~ +11
X Wing Vol ~ +8

Seems like there was good volume in both futures and options for the first 4-5 hours but things dieing down now.
Option Bid/Ask now so wide you can't trade anything.
12.58am
ESU5 ~ 1924
V Wing Vol looks like its ~ +12
X Wing Vol ~ +9
For the first time in a while, I'm now short ES Options, V1400P.

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Old August 24th, 2015, 09:53 AM   #4812 (permalink)
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Warning to IB account holders

Interactive Brokers Bulletin Board

To CFE,ECBOT,GLOBEX,NYBOT,NYMEX,NYSELIFFE traders:
Mon Aug 24 08:40:32 2015 EST
In light of the notable volatility in global markets, we are temporarily suspending intra-day margin release. Please monitor your accounts accordingly to ensure margin compliance. Any account not in margin compliance will, as always, become subject to IB-initiated liquidation.

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Old August 24th, 2015, 10:32 AM   #4813 (permalink)
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SMCJB View Post
Seems like there was good volume in both futures and options for the first 4-5 hours but things dieing down now.
Option Bid/Ask now so wide you can't trade anything.
12.58am
ESU5 ~ 1924
V Wing Vol looks like its ~ +12
X Wing Vol ~ +9
For the first time in a while, I'm now short ES Options, V1400P.

I would have waited for after the Monday 7-10 am selling wave before adding new shorts. But of course I could have been wrong.

It seemed like the selling was in waves as each part of the world started trading. Down to open plus Chinese market down. Then a rebound. Then another drop when EU started trading then a rebound. Now down big when US is fully trading and people are being forced out. I'm guessing we won't settle at -100 ES but this might be big enough drop to keep the selling going for another day.

Looks like ES hit a circuit breaker now.

The worst part is that this move is so being overdone by the market. -12% in 4 days with no major news?

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Old August 24th, 2015, 11:07 AM   #4814 (permalink)
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SMCJB View Post
Seems like there was good volume in both futures and options for the first 4-5 hours but things dieing down now.
Option Bid/Ask now so wide you can't trade anything.
12.58am
ESU5 ~ 1924
V Wing Vol looks like its ~ +12
X Wing Vol ~ +9
For the first time in a while, I'm now short ES Options, V1400P.

When ES was down on its lows ~ 1830/1840 ~ V wing vol was +20 ish and X wing Vol was +17 ish.
With ES back to ~ 1900, V wing vol is +12 ish and X wing Vol was +10 ish.

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Old August 24th, 2015, 11:07 AM   #4815 (permalink)
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Futures Edge on FIO
VIX hit a high of 53. The only time it has been higher was the 2008 meltdown.

Was the trigger the Fed minutes being or the Yuan devaluation?

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Old August 24th, 2015, 11:15 AM   #4816 (permalink)
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Chubbly View Post
VIX hit a high of 53. The only time it has been higher was the 2008 meltdown.

Was the trigger the Fed minutes being or the Yuan devaluation?

Asian market crash.

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Old August 24th, 2015, 11:17 AM   #4817 (permalink)
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ron99 View Post
I would have waited for after the Monday 7-10 am selling wave before adding new shorts. But of course I could have been wrong.

It seemed like the selling was in waves as each part of the world started trading. Down to open plus Chinese market down. Then a rebound. Then another drop when EU started trading then a rebound. Now down big when US is fully trading and people are being forced out. I'm guessing we won't settle at -100 ES but this might be big enough drop to keep the selling going for another day.

Looks like ES hit a circuit breaker now.

The worst part is that this move is so being overdone by the market. -12% in 4 days with no major news?

I think there are humans emotion involved (gread, stinginess etc), and this one is measureless...

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Old August 24th, 2015, 11:20 AM   #4818 (permalink)
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Chubbly View Post
VIX hit a high of 53. The only time it has been higher was the 2008 meltdown.

Was the trigger the Fed minutes being or the Yuan devaluation?


ron99 View Post
Asian market crash.

Agree. It was weak on the open but it seemed to break when Asia went South.

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Old August 24th, 2015, 11:25 AM   #4819 (permalink)
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My IMx3 spreads have hit exit point. I will exit when I see market start to drop again.

My IMx4 spreads are not at exit point at 10:15 am (ignoring craziness from 9:10 am to 9:40 am). But drawdown is 47%. I will probably exit these today too.

I suspect margin calls tomorrow will send another wave of selling.

After this is over we need to research ways to limit losses better. Selling futures? Just getting out at any sign of trouble? Find another way to invest money

I am seriously troubled by what the markets have become because of algo trading.

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Old August 24th, 2015, 11:34 AM   #4820 (permalink)
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ron99 View Post
The worst part is that this move is so being overdone by the market. -12% in 4 days with no major news?

I believe the appropriate quote is "The market can stay irrational for longer than you can stay solvent."

Brutal month so far - I wonder how much the Chinese stock market was driven by Chinese housewives buying stocks on insane margin? Seems very similar to the GBP/JPY carry-trade unwind with the prior crisis. Lots of people lost their shirts during that move.

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