Welcome to NexusFi: the best trading community on the planet, with over 150,000 members Sign Up Now for Free
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 for basic access, or support us by becoming an Elite Member -- see if you qualify for a discount below.
-- Big Mike, Site Administrator
(If you already have an account, login at the top of the page)
Hi guys, first post here. Long time trader of equities, started taking an interest in trading some futures options.
Was looking at some CL options the other day as trading instruments.
July $30 Call
July $20 Put
At the time the May contract CL price was about $21, but the $30 call was trading around $5-6 and the $20 put is only at $0.80
In my mind these prices should have been reversed. What am I missing? Has the Swiss National Bank put a floor at $20 (joking) or what the hell is going on? Is the market just pricing it there because it is so much more confident in a rise over $30 rather than a fall far under $20?
Trading: Primarily Energy but also a little Equities, Fixed Income, Metals and Crypto.
Frequency: Many times daily
Duration: Never
Posts: 5,049 since Dec 2013
Thanks Given: 4,388
Thanks Received: 10,207
When you buy an option on an equity, the underlying equity is the same. So May Calls on MSFT and July Calls on MSFT, both have the same underlying MSFT stock.
Most (but not all) Futures Options do not work like that. May Crude Calls are options on May Crude Oil Futures. July Crude Oil Calls are options on July Crude Oil Futures. The spread between May and July futures is currently about $11.30. (May is $18.30 and July is $29.60) This is why those July option prices look so weird, your comparing them to the May price not the July one.