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Wheat options - zero volume on in-the-money strikes close to current spot price
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Wheat options - zero volume on in-the-money strikes close to current spot price

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Wheat options - zero volume on in-the-money strikes close to current spot price

Wondering if anyone has suggestions or knowledge regarding trading wheat options. I'm looking at trading this market regularly for swing trading purposes and have noticed that some days there is 0 volume associated with in-the-money strikes that are currently close to the actual spot price. Why is that and how is the liquidity in these markets for when and if I wish to scale in the future?

Thanks in advance!

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  #3 (permalink)
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Topgun123 View Post
Wondering if anyone has suggestions or knowledge regarding trading wheat options. I'm looking at trading this market regularly for swing trading purposes and have noticed that some days there is 0 volume associated with in-the-money strikes that are currently close to the actual spot price. Why is that and how is the liquidity in these markets for when and if I wish to scale in the future?

Thanks in advance!

Let's start with the wheat futures:
S&C, Oct 2016 volume, p. 56, qualifies the liquidity as low/very low (monthly report).
If you are used to E-minis, you will enter a new world of bad fills or limits-not-filled respectively.

Compared with the low/very low liquidity of the wheat futures, the agricultural options series
are a level lower again. Large spreads aside: When you are absolutely lucky, open interest
at-the-money for the front month is 3k-5k. For the other months many strikes don't show any
OI at all; so if you manage to open a contract, you are the OI.

Why is that?
Always remember that a larger part of the commodities business bases on real production.
So e.g. scalability is very different from financial futures where only "paper" is traded.
The CoT reports show the figures.


Last edited by choke35; October 1st, 2016 at 10:01 AM.
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