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Ya, I figured they were in the $400 range for my estimates. You are correct it may be a bit high on the delta but with the amount of cash I leave sitting around (a tinch more than you) it should be fine. Depending on the movement of course of CL.
Anyway, I used OptionsXpress years ago and was fairly happy with it, really no complaints and their CSR's were good.
I appreciate the fundamental tips as I'm strickly technical in natural for all our postitions.
Due to the margin spread calculation error, do they still hold the first spread to this $value (899) or do they accept the 399 value for all of them? Or, do they charge 899 if only one spread is held? Can you explain this error further?
In the meantime before we have ox up and running, is there a website where i can get some general margin (span) calculations on naked calls and puts? I can do it myself (as in the $400 example above), but it's time consuming.
ya, no biggy. I'll wait till i get the username / password for OX. I've had an old one which I forgot the password for and I had them set a new password but it was sent to an older email...
Hey Ron, I am mainly a futures trader, but I have traded options in the past. In this sense I am not as sophisticated as you, so here come some questions:
I've read this discussion through and I couldn't find exactly how you deal with entering (opening) a naked put or call. I do remember you stating that it's tricky and sometimes you get what you want, sometimes not so much...
Initially what do you look for to make you interested in a position (besides fundamentals...)? Do you just watch the delta calculation on instruments your interested in and see if certain put/calls are declining to a preferable delta? Obviously you make sure there is huge OI on it. What is your process to actually sell that unit? Do you pick the middle of the B/A and set your full amount you are looking to acquire? Do you only look to acquire half/portion at first? Does this work? Is there a better time of day/week/month to submit a limit sell on a call or a put when hungry buyers need to purchase them? If there is a bid ask spread of $0.21 to 0.23 would you just hit the market or limit to the current bid?
All the money management (67%) and the 2X cash holdings, sell before long weekends, et cetera you don't have to go through. Like I said I did read through this discussion, forgive me if I skimmed over the answers to the above. Thanks again for imparting your knowledge.
Ya if I'm in the area I owe ya... Don't know how west coast salmon would ship... :-) We're havin a salmon bbq this saturday, can't wait - good times.
If anyone can be so kind, it looks like it may take a bit of time for my OX account to be enabled for the futures options (I've got to send in a bunch of documents) so I'm looking for some general markers. IE = margins.
If I'm able to get 3 month to expiry option put/call's that that are far OTM and ones that are halfway to ATM from far OTM for GC, SI, CL, ES, and NG? Such as:
CL Dec12 65P, 80P, 150C, 130C
NG Dec12 2P, 2.5P, 5c, 4c
GC Dec12 1400P, 1500P, 2100C, 1900C
SI Dec12 25P, 28P, 43c, 35c
ES Dec12 1000p, 1200p, 1800c, 1600c
I appreciate this is asking for a bit, so I'm obviously in no rush and indebted... just trying to do some analysis and risk calculations with these rough numbers while I wait.
Then I can keep my eye open to the CME and the such margin updates to stay up to date.
Another question I'd like to throw out there. When you have a short strangle do people find that the increase in one leg of the positions margin sometimes even's out with the decrease of the second leg's margin? I'm assuming the only thing that could increase both is heavy volatility in either direction.
How are other people doing that have taken on the call to do short strangles? Scott? Others? I've read this post all the way back to mid 2011 and have seen some pickup the call. I've enjoyed your posts too Britkid, thanks.
I like the BM forum, an amazing amount of great posts. Very happy to be here.
Regarding short strangles, I currently have two going 80/120 CL and 2/4 NG both Nov.
I nearly always try to do a strangle as you effectively get one side margin free and hence free premium. As you can see I am a lot more aggressive than Ron is, I am sure he would wince at my deltas.
As of today with CL now down to 94.75 my deltas are -.083 for the 80P and 0.0409 for the 120C. As I have 10 of each my net delta is -0.421, this has left my margin lopsided and slightly higher. The difference is not enough to warrant using a futures contract (delta 1.0). So what I have done is sell 4 x 110 calls with a delta of 0.106 at 0.53 which brings my delta back to zero and gains premium of $2120.
The effect on margin was minimal and has now rebalanced them.