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I read about this suggestion, but I did not trade it.
March 2019 is far away. In case inflation rises, or in case the US$ loses, the Silver calls will get problems. The COT data is bullish, and, thus, the Silver price might rise fast, if it rises.
to me, risk / reward do not seem to be well balanced.
I did put in a small position on the Cordier silver 14P/22C mainly because I don't believe inflation will be sustained and metrics recently came in higher, mainly due to crude rally.. again I could be totally wrong and as Myrrdin wrote, options are quite out on the future and the inflation could continue printing...
To Ron, Myrrdin and other seasoned posters on here: I'm having some issues with IB.. I use TOS, DeCarley and the link Ron had posted on ES deltas... The IB tws deltas are way off.. by almost 200 ES handles. Has anyone else noticed it? Wondering if there's an easier way to do this other than flipping between the platforms?
You need to include the increase in premium in the Margin Factor calculation. Otherwise you will be on margin call even though you covered the increase in margin.
Time erosion of the premium is lower with high DTE. I find that around 90-110 DTE is the sweet spot for selling and catching the start of accelerating time erosion of the premium.
jefforey, have you read the entire thread yet? I'm sure we covered DTE in it.
I was able to get the file to work, but I am wondering if I am getting my calculation right for Margin Factor calculation.
Can you check what is your max MF for 1 by 2 spreads of ESQ8 P1075 (-1) and ESQ8 P975 (+2) from 20080501 to 20080801?
The data that I have are as follow:
Max Margin Requirement throughout the life of the positions = $487.00
IM during opening of the position = $87.50
Thus, to withstand the movement I have it at $487.00 / $87.50 = 5.6 MF (5.6xIM) during this period.
But this just doesn't seem right with the downward move that occurred. Perhaps it's because the data from 2008 are the first day of the month.