Credit Spread ROI - Options on Futures | futures io social day trading
futures io futures trading

Credit Spread ROI
Updated: Views / Replies:677 / 3
Created: by linker33 Attachments:0

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

Thread Tools Search this Thread

Credit Spread ROI

  #1 (permalink)
Trading Apprentice
Boise, ID / USA
Futures Experience: Beginner
Platform: ThinkorSwim
Favorite Futures: Options
Posts: 9 since Apr 2015
Thanks: 3 given, 1 received

Credit Spread ROI

So, simple question just want to make sure this correct. On a credit spread the basic calculation for ROI would be...

[Credit received] / ([Diff between strikes]+[Commission])

So on a $20 credit for a $1 spread with $6 total commissions.

.20 / (1+.06) = 18.8% ROI

Is this sufficient in calculating, or am I missing something?


Reply With Quote
  #2 (permalink)
Quick Summary
Quick Summary Post

Quick Summary is created and edited by users like you... Add FAQ's, Links and other Relevant Information by clicking the edit button in the lower right hand corner of this message.

  #3 (permalink)
Trading Apprentice
Futures Experience: Beginner
Platform: ib tws
Favorite Futures: gbpusd, vix
Posts: 49 since Jul 2014
Thanks: 11 given, 41 received

You don't add commissions, you minus that off the credit.

$20 - $6 = $14 net.

Max loss = diff between strike - initial credit received
= $100 - $20 (not net here or you would be double counting commission)
= $80

$14/$80 = 17.5%

Assuming you use max loss as margin, and calculating return on margin. In case of loss, you have to incur another round of commission, assuming you didn't count it in $6. So it changes there again. If you already factored round trip but end up profiting expiring worthless, it changes again to higher ROI.

Reply With Quote
The following user says Thank You to k20a for this post:
  #4 (permalink)
Trading Apprentice
Boise, ID / USA
Futures Experience: Beginner
Platform: ThinkorSwim
Favorite Futures: Options
Posts: 9 since Apr 2015
Thanks: 3 given, 1 received

Got it, thanks for the clarification. Yes, the $6 would be total commissions on TOS ($1.50 per contract). I've been setting trades to close at 70% of max profit, so I count on having to pay to close out.

Reply With Quote


futures io > > > > Credit Spread ROI

Thread Tools Search this Thread
Search this Thread:

Advanced Search

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

Wyckoff Hunting for Great Risk/Reward Ratio w/Gary Fullett

Elite only

Digging into the Details of iSystems w/Stage 5 & iSystems

Jun 5

Similar Threads
Thread Thread Starter Forum Replies Last Post
Spread trading, calculating spread calhawk01 Emini Index Futures Trading 13 February 21st, 2017 08:20 AM
Credit spread techniques jvanen Options on Futures 11 August 5th, 2015 04:45 PM
optsel2a.xls Credit Spread SpreadSheet mdsvtr Traders Hideout 1 December 11th, 2014 04:05 PM
futures option spread versus futures spread leinster Commodities Futures Trading 4 September 7th, 2013 01:25 PM
Allistah's Weekly Vertical Credit Spread Journal Allistah Trading Journals 7 August 14th, 2012 12:22 PM

All times are GMT -4. The time now is 08:27 PM.

Copyright © 2018 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432,
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 2018-05-23 in 0.07 seconds with 19 queries on phoenix via your IP