anyone do verticle spreads - futures io
futures io



anyone do verticle spreads


Discussion in Options

Updated
      Top Posters
    1. looks_one futs with 2 posts (1 thanks)
    2. looks_two andrewhannigan with 2 posts (0 thanks)
    3. looks_3 Quick Summary with 1 posts (0 thanks)
    4. looks_4 DarkPoolTrading with 1 posts (0 thanks)
      Best Posters
    1. looks_one SMCJB with 2 thanks per post
    2. looks_two semiopen with 1 thanks per post
    3. looks_3 bchip with 1 thanks per post
    4. looks_4 futs with 0.5 thanks per post
    1. trending_up 5,219 views
    2. thumb_up 5 thanks given
    3. group 9 followers
    1. forum 12 posts
    2. attach_file 0 attachments




Welcome to futures io: the largest futures trading community on the planet, with well over 125,000 members
  • Genuine reviews from real traders, not fake reviews from stealth vendors
  • Quality education from leading professional traders
  • We are a friendly, helpful, and positive community
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts
  • We are here to help, just let us know what you need
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

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

 
Search this Thread
 

anyone do verticle spreads

(login for full post details)
  #1 (permalink)
joe7777
kingston
 
 
Posts: 18 since Jul 2014
Thanks: 2 given, 0 received

anyone specialize in verticle call spreads

thank you

Reply With Quote

Journal Challenge April 2021 results (now extended!):
Competing for $1800 in prizes from Jigsaw
looks_oneMaking a Living with the Microsby sstheo
(76 thanks from 10 posts)
looks_twoSalao's Journalby Salao
(23 thanks from 5 posts)
looks_3Deetee’s DAX Trading Journal (time based)by Deetee
(15 thanks from 7 posts)
looks_4Learning to Profit - A journey in algorithms and optionsby Syntax
(12 thanks from 7 posts)
looks_5Becoming a day trader (PA, volume profile, footprint etc.)by JirkaF
(0 thanks from 2 posts)
 
Best Threads (Most Thanked)
in the last 7 days on futures io
The Crude Dude Oil Trading System
73 thanks
futures io site changelog and issues/problem reporting
71 thanks
Would You Sell Your System?
65 thanks
FIO Journal Challenge - April 2021 w/Jigsaw Trading
30 thanks
Big Mike in Ecuador
25 thanks
 
(login for full post details)
  #3 (permalink)
 DarkPoolTrading 
PTA, Gauteng
 
Experience: Advanced
Platform: Self built + Sierra + TWS
Trading: Stocks and Options
 
DarkPoolTrading's Avatar
 
Posts: 1,036 since May 2012
Thanks: 1,244 given, 1,321 received


I trade call spreads among several other option strategies. Is there something specific you're looking to discuss related to call spreads,...or just spreads in general?

Diversification is the only free lunch
Follow me on Twitter Reply With Quote
 
(login for full post details)
  #4 (permalink)
 Bookworm 
Long Island, NY
 
Experience: Advanced
Platform: TOS & Tastyworks
Broker: TD Ameritrade
Trading: Equities, index options and futures options
 
Bookworm's Avatar
 
Posts: 175 since Apr 2010
Thanks: 65 given, 166 received

Vertical spreads are a great topic to study. Not only are they a great stand alone strategy but they are also the building blocks of many other more complicated structures like iron condors and the various types of butterflies.

Reply With Quote
 
(login for full post details)
  #5 (permalink)
galindog
Danbury Connecticut USA
 
 
Posts: 5 since Feb 2014
Thanks: 0 given, 1 received

Verticals are pretty versatile for they can operate under any volatility regime vs. other spreads that are only appropriate under low or hi implieds.

Reply With Quote
 
(login for full post details)
  #6 (permalink)
mcpandre
Milan, Italy
 
 
Posts: 7 since May 2017
Thanks: 0 given, 8 received

sometimes I do vertical spread on futures and stock, very often credit spreads.

Reply With Quote
 
(login for full post details)
  #7 (permalink)
andrewhannigan
New York, United States
 
 
Posts: 7 since Aug 2017
Thanks: 0 given, 1 received

yes, i do.

Reply With Quote
 
(login for full post details)
  #8 (permalink)
andrewhannigan
New York, United States
 
 
Posts: 7 since Aug 2017
Thanks: 0 given, 1 received

What do you want to know about verticle spreads? You can ask or share anything you want.

Reply With Quote
 
(login for full post details)
  #9 (permalink)
 bchip 
Africa
 
Experience: Advanced
Platform: TradeStation
Trading: ES,YM,CL,GC
 
Posts: 98 since Sep 2017
Thanks: 135 given, 76 received

Hi all

On the topic of vertical call spreads. Im learning about them now myself.
I would just like to check if my calculations are right here-
When I compare it to TD Ameritrade it differs slightly.

Today AAPL is @ 230
When I open a Vertical spread on TOS I go
- Call1: long Call @ 230 (prem: $19.6) and
- Call2: short call @ 235 (prem: $17)
Its on a 30 day option (weekly) set to expire on 24 Apr (32 days from today)
So here are my calcs

If the market goes to 220: (as both expire)
lose -$1960 premium, gain $1700 -> net = -$260

If the market goes to 233: (as call1 exercised, call2 expire)
lose -$1960 premium, gain $300, gain $1700 -> net = +$40

If the market goes to 240: (as both exercised)
lose -$1960 premium, gain $1700, gain $1000 on call1, lose -$500 on call2 -> net = $240

Therefore my max profit is $240 and max loss is $-260


Thank you

Reply With Quote
The following user says Thank You to bchip for this post:
 
(login for full post details)
  #10 (permalink)
 futs 
Clearwater FL US
 
Experience: Beginner
Platform: Etrade, Tradovate and TOS
Trading: SPX, /ES, /MES, Options
 
Posts: 33 since Jan 2019
Thanks: 22 given, 19 received


On debit spreads Max loss is what you pay for it 260 and Max profit is the spread width minus what you paid for it 240.

Sent using the futures.io mobile app

Reply With Quote
The following user says Thank You to futs for this post:
 
(login for full post details)
  #11 (permalink)
 futs 
Clearwater FL US
 
Experience: Beginner
Platform: Etrade, Tradovate and TOS
Trading: SPX, /ES, /MES, Options
 
Posts: 33 since Jan 2019
Thanks: 22 given, 19 received

Watch their videos and take their options course to learn the Greeks.

Sent using the futures.io mobile app

Reply With Quote
 
(login for full post details)
  #12 (permalink)
 SMCJB 
Legendary Market Wizard
Houston, TX
 
Experience: Advanced
Platform: Trading Technologies
Broker: Primary Advantage Futures. Also ED&F and Tradestation
Trading: Primarily Energy but also a little GE, GC, SI & Bitcoin
 
Posts: 4,034 since Dec 2013
Thanks: 3,340 given, 7,955 received


bchip View Post
Today AAPL is @ 230
When I open a Vertical spread on TOS I go
- Call1: long Call @ 230 (prem: $19.6) and
- Call2: short call @ 235 (prem: $17)
Its on a 30 day option (weekly) set to expire on 24 Apr (32 days from today)
So here are my calcs
7
If the market goes to 220: (as both expire)
lose -$1960 premium, gain $1700 -> net = -$260

If the market goes to 233: (as call1 exercised, call2 expire)
lose -$1960 premium, gain $300, gain $1700 -> net = +$40

If the market goes to 240: (as both exercised)
lose -$1960 premium, gain $1700, gain $1000 on call1, lose -$500 on call2 -> net = $240

Therefore my max profit is $240 and max loss is $-260

Thank you

Your answers are correct but I wouldn't describe the way you do.
Below $230 is your max loss - you lose premium (19.6-17) $2.60 * 100 = $260
Above $350 is your max gain - you make $5, verses premium of $2.60 so (5-2.6)8100 = $240

Interesting that with the stock at 230 that the 230/235 call spread has a less than 50/50 win/reward!

Reply With Quote
The following 2 users say Thank You to SMCJB for this post:
 
(login for full post details)
  #13 (permalink)
 semiopen 
hillsborough nj
 
Experience: Advanced
Platform: Tradestation/Excel
Broker: TradeStation
Trading: emicro
 
Posts: 97 since Sep 2018
Thanks: 17 given, 44 received


futs View Post
Watch their videos and take their options course to learn the Greeks.

Sent using the futures.io mobile app

When they were first designing listed options, they needed to know the hedge ratio. That was solved by Black and Scholes, which was a remarkable advance in the 70s. A binomial model is simpler to understand I think. An ATM option should have a hedge ratio of .5, that is the option will move about $0.50 for each $1 move in the stock over short distances.

Hedge ratio was a great term but then it got spoiled by changing the name to delta and then using 3 other greek letters for more trivial stuff that is probably close to worthless. The academics gave them greek letters so normal people can't type them.

Learn hedge ratios.

Reply With Quote
The following user says Thank You to semiopen for this post:


futures io Trading Community Traders Hideout Options > anyone do verticle spreads


Last Updated on May 2, 2020


Upcoming Webinars and Events
 

NinjaTrader Indicator Challenge!

Ongoing
 

Journal Challenge w/$1,800 in prizes!

April
 

Seven Trading Mistakes Solved With Smart Trading Tools w/Brannigan Barrett

Elite only
     



Copyright © 2021 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