Selling Options on Futures? - Options on Futures | futures io social trading
futures io futures trading


Selling Options on Futures?
Updated: Views / Replies:660,877 / 6,181
Created: by ron99 Attachments:714

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 90,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors Ė all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you donít need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Reply
 714  
 
Thread Tools Search this Thread
 

Selling Options on Futures?

  #671 (permalink)
Trading Apprentice
Toronto/Canada
 
Futures Experience: Advanced
Platform: Sierra Charts
Favorite Futures: Options
 
Posts: 25 since Oct 2012
Thanks: 20 given, 5 received

Hey,
FYI

CTH3 .79P going for .0008 (40.00) Delta .097
A little more risky, but they expire Friday at 2.30!

Reply With Quote
 
  #672 (permalink)
Market Wizard
Cleveland, OH
 
Futures Experience: Advanced
Platform: QST
Broker/Data: QST, DeCarley Trading, Gain
Favorite Futures: Options on Futures
 
Posts: 2,616 since Jul 2011
Thanks: 756 given, 4,492 received
Forum Reputation: Legendary


Mark59 View Post
Hey,
FYI

CTH3 .79P going for .0008 (40.00) Delta .097
A little more risky, but they expire Friday at 2.30!

You do realize that if CT drops the same amount it did on 1/25 that your option will be ITM.

Be careful with those. I don't know if $40 minus fees is worth the risk to do those.

I once held onto short NG 5.250 call options to expiration. It settled at 5.251. All of those calls turned into futures because of 0.002. The futures immediately went higher and I lost thousands.

Reply With Quote
 
  #673 (permalink)
Trading Apprentice
Toronto/Canada
 
Futures Experience: Advanced
Platform: Sierra Charts
Favorite Futures: Options
 
Posts: 25 since Oct 2012
Thanks: 20 given, 5 received


Thanks Ron

Warning well taken...I understand they need to be looked at with caution.
Lots of risk there, just put on a small position & really keep an eye on them.

Cheers

Reply With Quote
 
  #674 (permalink)
Trading for Fun
Houston, Texas
 
Futures Experience: Advanced
Platform: Interactive Brokers, OptionsXpress
Broker/Data: Options Express
Favorite Futures: Options on Futures
 
MJ888's Avatar
 
Posts: 165 since Sep 2012
Thanks: 37 given, 123 received


Mark59 View Post
Hey,
FYI

CTH3 .79P going for .0008 (40.00) Delta .097
A little more risky, but they expire Friday at 2.30!

Thanks but no thanks! After commission, I would make $32.49 per and as Ron said, a sell off would send that strike ITM.

Not worth the risk IMO

Reply With Quote
 
  #675 (permalink)
Trading Apprentice
Toronto/Canada
 
Futures Experience: Advanced
Platform: Sierra Charts
Favorite Futures: Options
 
Posts: 25 since Oct 2012
Thanks: 20 given, 5 received

MJ

Thanks for your opinion , but I was not suggesting you put on the trade.

Reply With Quote
 
  #676 (permalink)
Market Wizard
Cleveland, OH
 
Futures Experience: Advanced
Platform: QST
Broker/Data: QST, DeCarley Trading, Gain
Favorite Futures: Options on Futures
 
Posts: 2,616 since Jul 2011
Thanks: 756 given, 4,492 received
Forum Reputation: Legendary

Interesting. The ROI for a CLj3 70 put is higher than the ROI for a CLj3 75 put for tomorrow.

Using 6.21 for fees (several posters said that is what they were paying), the ROI for the 75 is 5.4% monthly. For the 70 the ROI is 5.6% monthly.

And of course the 70 is less risk.

Reply With Quote
 
  #677 (permalink)
Elite Member
NW Florida
 
Futures Experience: Intermediate
Platform: OX and TOS
Favorite Futures: Futures Options, Stocks
 
opts's Avatar
 
Posts: 234 since Aug 2012
Thanks: 29 given, 107 received


ron99 View Post
Interesting. The ROI for a CLj3 70 put is higher than the ROI for a CLj3 75 put for tomorrow.

Using 6.21 for fees (several posters said that is what they were paying), the ROI for the 75 is 5.4% monthly. For the 70 the ROI is 5.6% monthly.

And of course the 70 is less risk.


Ron:

I'm thinking your assuming that the options would not be bought back and would expire worthless (no comm. or fees) to figure in with the ROI correct?

Reply With Quote
 
  #678 (permalink)
Market Wizard
Cleveland, OH
 
Futures Experience: Advanced
Platform: QST
Broker/Data: QST, DeCarley Trading, Gain
Favorite Futures: Options on Futures
 
Posts: 2,616 since Jul 2011
Thanks: 756 given, 4,492 received
Forum Reputation: Legendary


opts View Post
Ron:

I'm thinking your assuming that the options would not be bought back and would expire worthless (no comm. or fees) to figure in with the ROI correct?

Correct.

And if futures don't take a dive then your margin will drop and your premium drops and thus your balance increases you will be able to take some of the initial margin and excess and reinvest it in other options. So if things go OK your actual ROI is higher than the numbers I quote.

The 5.6% ROI assumes that you keep the same margin and excess until the contract expires. Which normally you don't. But I don't know of a way to accurately calculate the ROI with decreasing margin and excess plus increasing profit until expiration.

Anybody got an idea on that?

So when we post a monthly ROI% of only 2-5%, which seems small, the actual profit% in your account is higher.

Reply With Quote
 
  #679 (permalink)
Market Wizard
Cleveland, OH
 
Futures Experience: Advanced
Platform: QST
Broker/Data: QST, DeCarley Trading, Gain
Favorite Futures: Options on Futures
 
Posts: 2,616 since Jul 2011
Thanks: 756 given, 4,492 received
Forum Reputation: Legendary

One other point. Keeping an option to expiration is worth the trouble. You may not think that it is worth it for the last $10. But in most cases it is. The margin probably has dropped a lot so it isn't tying up a lot of your money.

For example, I have on Mar CL 70 puts. They are down to 0.01 or $10. But the margin is only 65 at OX. Because it is only 8 days from expiring and far OTM, I only use 1X excess or 65. So the ROI for that option that is already in my account and I won't be paying fees on anymore is 7.7% actual for 8 days. $10 divided by 130.

And the margin will drop more if futures don't crash. The 65 put margin is only $36.

Where else can you get more than 7.7% ROI in only 8 days?

Reply With Quote
 
  #680 (permalink)
Elite Member
NW Florida
 
Futures Experience: Intermediate
Platform: OX and TOS
Favorite Futures: Futures Options, Stocks
 
opts's Avatar
 
Posts: 234 since Aug 2012
Thanks: 29 given, 107 received



ron99 View Post
One other point. Keeping an option to expiration is worth the trouble. You may not think that it is worth it for the last $10. But in most cases it is. The margin probably has dropped a lot so it isn't tying up a lot of your money.

For example, I have on Mar CL 70 puts. They are down to 0.01 or $10. But the margin is only 65 at OX. Because it is only 8 days from expiring and far OTM, I only use 1X excess or 65. So the ROI for that option that is already in my account and I won't be paying fees on anymore is 7.7% actual for 8 days. $10 divided by 130.

And the margin will drop more if futures don't crash. The 65 put margin is only $36.

Where else can you get more than 7.7% ROI in only 8 days?


I'm seeing the movement with margin requirement with my March 900 W calls. Available margin has gone up considerably in the past few days. No need to buy them back.

Reply With Quote

Reply



futures io > > > > Selling Options on Futures?

Thread Tools Search this Thread
Search this Thread:

Advanced Search



Upcoming Webinars and Events (4:30PM ET unless noted)

July Journal Challenge w/$1100 in prizes from TopstepTrader

July

John @ No BS Day Trading (TBA)

Elite only

An Afternoon with FIO member Softsoap (being rescheduled)

Elite only
     

Similar Threads
Thread Thread Starter Forum Replies Last Post
Crude Oil (CL) futures inverse pairing options Big Mike Commodities Futures Trading 8 December 12th, 2013 11:00 AM
Recommend futures, options Broker? sam1197 Reviews of Brokers and Data Feeds 17 March 27th, 2013 12:42 AM
Trading Futures with options as protection Gooffy2010 Commodities Futures Trading 6 October 2nd, 2012 04:55 PM
Selling Njniatrader sam1197 NinjaTrader 22 June 28th, 2012 12:40 PM
Zen-Fire Futures options tici88 Reviews of Brokers and Data Feeds 1 July 30th, 2011 09:16 AM


All times are GMT -4. The time now is 08:29 AM.

Copyright © 2017 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432, info@futures.io
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2017-06-29 in 0.09 seconds with 19 queries on phoenix via your IP 54.224.19.6