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Trading: short fut. opt., fut. spreads, div. stocks
Posts: 57 since Feb 2012
Thanks Given: 3
Thanks Received: 27
hi guys,
to get back to that spread i mentioned before: sell NGH14 buy NGJ14
i closed it today.
Guess it was a very lucky trade (well you need that sometimse ;-)
sold at $2700 and bough back this morning at $700
i did not expect it to come down so fast, thought it would take till feb to get it down...
perhaps wait a while if the spread get again above $2500 to ride it again ;-)
happy new year with good trades.
Can you help answer these questions from other members on NexusFi?
Trading: short fut. opt., fut. spreads, div. stocks
Posts: 57 since Feb 2012
Thanks Given: 3
Thanks Received: 27
if it happens again, i guess i'll wait till i see it bend down again over the top this time
i still think the chances it will expire with a difference between $500 to $1000 (between the contracts) are higher than some guys playing the market... but i'll look at the historical years this weekend...
@josh: Gross is bullish on the front end of the curve, because the taper announcement combined with a drop in IOER could turn out to be very bullish for the bond market. And, this would persist until the Fed actually raises the funds rate, which wouldn't be until JY sees 6.5% unemployment and 2.0% inflation.
newbie to spreads here. I never really go to thinking about them much as late until i looked at SeasonalAlgo and saw NGM14-NGQ14 spread and it got me thinking. I was wondering if this could be done with options as well?
Trading: short fut. opt., fut. spreads, div. stocks
Posts: 57 since Feb 2012
Thanks Given: 3
Thanks Received: 27
hi,
Here the NGh-NGj spreads of the last 9 years, and except 2009 all others ended negative (top left is current and still positive).
Even the 2006 year ended negative.
All curves are downwards
although the NG market changed a lot last few years, i guess there is a fair chance that if it gets high enough again it can be a nice ride down again.
@Nomad4x, i'm new to spreads too, and like you have the feeling money can be made. would love to share experiances to learn. Does seasonAlgo has stacked charts? so eg. the same contracts (or spreads) of various years on top of each other?
Where to learn to spread trade? Can anybody recommend resources to learn spread trading? Not looking for "guru" but simple resource that explains the mechanics. thanks.
Not that I'm aware of, however, if you have 50 twitter followers and do a tweet advertising Tweet about us and get full access for 14 days | SeasonAlgo.com - SA they will give you a 14 day trial. I was looking at this for my selling options and stumbled across your thread and thought this sort of fits in to selling options in a round about way. I get seasonal data in TNT Live, however, it is somewhat cumbersome and not logical.
I'll post here when I know a bit more about stacking charts. This should be a fun journey!
Trading: short fut. opt., fut. spreads, div. stocks
Posts: 57 since Feb 2012
Thanks Given: 3
Thanks Received: 27
Do you mean buying or selling? (or buy one /sell other?)
Point is that with a spread, both contracts can go up but if one goes up faster the spread either goes up or down.
So if the spread goes up you don't know what the 2 future do.
what i like about spreads is that you have a complete different instrument (low correlation with others), also it (often) doesn't move as fast as the futures (so can be traded with smaller accounts or used to open more different spreads to diversify for the same money) and i have the idea they move more gradually (not as erratic/high vola as the futs)
and obviously the margin is lower but the gains too.
@MeanBean,
MRCI MRCI Products seasonal spread strategies and trading strategies for futures traders has some spreads & seasonal but I never made any money with those (when I had a membership)
Point is (in my opinion) they look back 5 or 10 years see that if you traded between date X and date Y you would have had 90% winners and made $$$. But if you have enough data you always find those periods and in statistics 5 or 10 samples is really nothing (which seems to be correct, seen their bad performing portfolio, once again when i was there a few years ago).
So either I’m not doing it right (using their info that is) or…
The basics are pretty simple, you buy one contract and sell the other and I’m a strong believer that you can learn a lot form books but nobody is going to tell you how to make $$$ (in that case they didn’t write the book but used their own system).
Happy to share experiences with you, in a quest to finding a profitable way of trading spreads.