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Seasonal Trades


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Seasonal Trades

  #271 (permalink)
mosalem2003
Toronto
 
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myrrdin View Post
I prefer futures spreads in case I expect a large movement of the spread.

I prefer options in case I expect side wards or small movement.

Best regards, Myrrdin

So you are not selling naked options but credit spreads on both sides if you expect side-way move which is some how discretionary to how you analyze the market. The seasonal spread is expecting a move but you see the trade as rangy, so you adopt a protective way...

In other words, would u recommend selling option credit spreads as general strategy in addition to seasonal spread OR we pick one versus the other ?

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  #272 (permalink)
 myrrdin 
Linz Austria
 
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mosalem2003 View Post
So you are not selling naked options but credit spreads on both sides if you expect side-way move which is some how discretionary to how you analyze the market. The seasonal spread is expecting a move but you see the trade as rangy, so you adopt a protective way...

In other words, would u recommend selling option credit spreads as general strategy in addition to seasonal spread OR we pick one versus the other ?

I am a discretionary trader and not a system trader. I decide on the style for each trade separately.

Seasonal charts are only one element of the basis of my seasonal trades. I also have a look at supply & demand, COT data and the chart to define which way the price of the commodity might go with a high probability.

When I started seasonal trading many years ago I more or less followed the seasonal charts of MRCI trading futures or future spreads. I soon found out that they work significantly better when the actual chart has followed the seasonal chart for some months. And with time I learned about S&D, COT data, volatility etc., and I improved my trades further.

According to my experience, it is helpful to have a toolbox with several trading strategies in it. But I doubt that this is the right way for a beginner. In the beginning, you have to learn and optimize one strategy. And I know excellent traders who are very successful with only one trading strategy. Of course, they know when to apply it, and when to take a rest.

Best regards, Myrrdin

PS: There is a simple reason why I often use credit spreads instead of naked short options. My broker "Interactive Brokers" has extremely high margin for naked options.

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  #273 (permalink)
 
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 Kruger 
Cape Town South Africa
 
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SMCJB View Post
What are you thinking on this?

Based on the seasonal trend the current price suggests that there is room for upward movement but I doubt that it will result in a handsome profit this year. I did enter but don't expect to make a huge profit but as they say in the classics 'a half loaf of bread is better than none'.
Regards

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  #274 (permalink)
 myrrdin 
Linz Austria
 
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I generally like bear spreading the hogs in summer and fall. This year I entered the trade early, as the LHG-LHV was extremely low a couple of days ago.

This trade is a classical seasonal trade, although it is not reported in MRCI (anymore). The reason is that it fails in some years - in years which are dominated by "special effects", e.g. illnesses of hogs or COVID 19. But these years are easy to identify, and I assume this spread will work this year, as the entry level is very low.

For the next couple of months I will have a look at these spreads, among others the LHG-LHZ, LHJ-LHG, and LHM-LHG.

Best regards, Myrrdin

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  #275 (permalink)
mosalem2003
Toronto
 
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I know that some of the yield spreads are available as single ticket from CME under IB. For calendar spreads, is it the same case or we need to synthesize the spread? I am using Sierra Chart API to IB TWS. So it will be good to initiate the spread trade as single ticket from Sierra as TWS doesn't have any money management for trades.

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  #276 (permalink)
 jokertrader 
NYC, NY
 
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For mostly all calendar spreads they are single ticket for example CL JUNE/Dec or Ags like ZS H/K etc


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  #277 (permalink)
 jokertrader 
NYC, NY
 
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Honestly not sure how IB does spread symbols but if u get the right symbol you should be able to chart in Sierra.. for example for CQG feed its CLES1z21 which is the 1 month calendar spread for Crude of Dec/Jan.. TT is slightly different etc .. some butterflies are also implied which means single ticket and different from market to market.. so maybe if you are using IB is to find out the terminology for IB.. if you are using a different data in Sierra then might be different


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  #278 (permalink)
 myrrdin 
Linz Austria
 
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mosalem2003 View Post
I know that some of the yield spreads are available as single ticket from CME under IB. For calendar spreads, is it the same case or we need to synthesize the spread? I am using Sierra Chart API to IB TWS. So it will be good to initiate the spread trade as single ticket from Sierra as TWS doesn't have any money management for trades.

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Almost all spreads can be traded as single ticket spreads in the TWS. The charts of these spreads can be displayed. Exceptions (as far as I know) are spreads, where both legs are traded at different exchanges.

Intra-commodity spreads (= calendar spreads) are shown as spreads in the P&L table. Inter-commodity spreads are shown as single positions.

Spreads can have many legs (e.g. butterflies).

You do not have to know the nomenclature of spreads. There is a form where you enter both legs, and it is combined to one spread automatically by the system.

Best regards, Myrrdin

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  #279 (permalink)
mosalem2003
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Trying to trade Yield curve spread at IB. Order Entry quotes are totally different than the price axis values from the chart. The chart is an example for the TUT spread [02s10s spread] Seems like CME quotes the spread relative to the daily settlement changes. Any one with experience of the yield spreads from IB ?
How to place a limit order based on the chart given that we are using the order entry which is not an identical price levels? Any experience ?
IB representative doesn't know as well !

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  #280 (permalink)
 myrrdin 
Linz Austria
 
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mosalem2003 View Post

Trying to trade Yield curve spread at IB. Order Entry quotes are totally different than the price axis values from the chart. The chart is an example for the TUT spread [02s10s spread] Seems like CME quotes the spread relative to the daily settlement changes. Any one with experience of the yield spreads from IB ?
How to place a limit order based on the chart given that we are using the order entry which is not an identical price levels? Any experience ?
IB representative doesn't know as well !

I never had a look at these spreads.

For difficult questions to to the helpdesk of IB it often helps to send a message via the message center. It takes a while, but usually you will get a good answer.

Best regards, Myrrdin

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Last Updated on May 4, 2021


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