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Selling Options on Futures?
Started:July 19th, 2011 (06:16 PM) by ron99 Views / Replies:569,132 / 5,728
Last Reply:December 6th, 2016 (05:26 PM) Attachments:642

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Selling Options on Futures?

Old January 18th, 2013, 05:04 PM   #511 (permalink)
Market Wizard
OH
 
Futures Experience: Advanced
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MJ888, Last year the Jun 130 CL call was 1.00 on Jan 18th. It was 1.54 on Feb 24th.

In 2011, this call was 0.15 on Jan 18th. On Mar 7th it was 2.51.

The seasonal chart is dramatically up for CL from now to the end of Apr. Especially up in Feb.

While I doubt that CL gets to 130, the possible increase in margin and premium might force you out unless you have tons of excess cash.

I'd highly recommend staying away from CL calls right now unless you have thousands in cash to cover movements against you.

Right now a Jun CL 65 put is the same premium as a 130 call. But the IM required is $190 less at OX. So it is a better ROI to sell the put.

Also the Delta on the put is 0.0188 while the call is 0.0311. More risk for the call.

I'm selling CL puts right now. Not as far out as June. I'm staying with May or closer.

Remember that CL usually drops a lot in May. Don't want to have puts on then.

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Old January 19th, 2013, 12:31 AM   #512 (permalink)
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Ummm.. this might not have much to do with this thread but.. I have been looking at getting a full service futures broker to help me put on my spread trades. commission is 37.50 USD a side. Should I be looking for another broker? Or should I wait and see how we do? maybe I will start a new thread. I eventually want to trade to my own account.


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Old January 19th, 2013, 01:05 AM   #513 (permalink)
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Ron99, thanks for the advice on CL.

Where is a good place to get seasonal charts? The link to CCS asks me to register and sign up for an account. And how were you able to get access to options prices from two years ago?

And yes, I do remember that CL rallied higher the past two years in February, especially during the long President's Day weekend.

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Old January 19th, 2013, 04:49 AM   #514 (permalink)
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Mackypinky View Post
Ummm.. this might not have much to do with this thread but.. I have been looking at getting a full service futures broker to help me put on my spread trades. commission is 37.50 USD a side. Should I be looking for another broker? Or should I wait and see how we do? maybe I will start a new thread. I eventually want to trade to my own account.



If by spread you are talking about calendar futures spreads (no options involved), find another broker. I pat the same rate as the individual legs. So, if I sell the May Corn / Dec Corn spread, the commissions are the same as selling May Corn and buying Dec Corn.

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Old January 19th, 2013, 10:41 AM   #515 (permalink)
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MJ888 View Post
Ron99, thanks for the advice on CL.

Where is a good place to get seasonal charts? The link to CCS asks me to register and sign up for an account. And how were you able to get access to options prices from two years ago?

And yes, I do remember that CL rallied higher the past two years in February, especially during the long President's Day weekend.

I just went to the CCS website and the charts work. Sometimes the charts are very slow to load. Like 2 minutes! You just can use the links on the first page. If you try to use the submit button on the top of a page of charts that doesn't work.

The only other place I know of to get seasonal charts is MRCI. But you have to pay to get those. I do subscribe to them.

I have spent the last six months making excel spreadsheets of seasonals for the years 2007-now. The each chart has each year, 2007 thru 2013, on them for each commodity. For example, I have a page for CLf, CLg, CLh, etc. I have over 100 spreadsheet pages.

Sometimes I find looking at the 6 lines, last 6 years, on one chart is better info than just looking at the 5 year average number. The abnormal 2008 data throws off a 5 year average chart.

I get past year data from my QST platform which is a special deal from one of my brokers. That deal was only available to me because I has traded with that broker for over 10 years.

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Old January 19th, 2013, 10:42 AM   #516 (permalink)
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kevinkdog View Post
If by spread you are talking about calendar futures spreads (no options involved), find another broker. I pat the same rate as the individual legs. So, if I sell the May Corn / Dec Corn spread, the commissions are the same as selling May Corn and buying Dec Corn.

Is that at Tradestation or somewhere else? Are your spread trades done in the pit or online? Does Tradestation charge you the 0.10 overnight fee?

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Old January 19th, 2013, 01:46 PM   #517 (permalink)
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kevinkdog

Its a full service broker.

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Old January 19th, 2013, 01:47 PM   #518 (permalink)
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Oh yea and they are calender spreads.

If I Build option spreads do I need less margin and maintenance money??
Maybe futures options are a better for smaller accounts say less than 20K. I guess Liquidity could be a problem eg. June 2013 Live Cattle.
Do futures options spreads work better with TA than a typical 2 leg calender spread?

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Old January 22nd, 2013, 01:45 AM   #519 (permalink)
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Hi all, was hoping Ron or anyone familiar with the OX platform could answer this for me. Is there a quick and easy way to find out margin of a particular strike without going into trade calc? I'm finding it fairly time consuming popping in and out of trade calc and back to the chains. I would prefer to first work out if my ROI is solid enough before going into trade calc....

Thanks

crez

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Old January 22nd, 2013, 10:52 AM   #520 (permalink)
Market Wizard
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crez View Post
Hi all, was hoping Ron or anyone familiar with the OX platform could answer this for me. Is there a quick and easy way to find out margin of a particular strike without going into trade calc? I'm finding it fairly time consuming popping in and out of trade calc and back to the chains. I would prefer to first work out if my ROI is solid enough before going into trade calc....

Thanks

crez

Trade Calc is the only place to get option margin in OX.

But on the trade calc page there is "Detach". Middle of page to the right of Calculate. Click on that and it will open trade calc in a separate tab in your browser. I do that every trading day. Using that is much quicker than moving into trade calc and then to option chains.

If you then want to trade that option after calculating the margin, click on trade now on the trade calc page and the order will appear partially filled out in your other tab. Just set price and quantity.

You can also detach the chains too.

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