Option Trading - Thinking Outside the Box! Intermediate To Advanced Futures Options Strategies by Unknown

Author:Unknown
Language: eng
Format: mobi, epub
Published: 2000-12-31T22:00:00+00:00

The March 118 Call is 6 times more expensive than the January 118 Call, but it ONLY has 2.13 times more time left.

January T-Bond 104 Put options settled at -04.

March T-Bond 104 Put options settled at -16.

The March 104 Put is 4 times more expensive than the January 104 Put, but it ONLY has 2.13 times more time left.

You will notice that in the example above, there are 2 different underlying futures markets involved. Each options market is following it’s own futures market. This is fine. Although the prices are not exactly the same, the markets generally move in the same direction. In this example, the out of the money options in the front month have another advantage. The strike prices are a little closer than in the far month options. Only the out of the money options will be looked at for this scenario.

December U.S. Dollar contract closed at 89.46 March U.S. Dollar contract closed at 89.19

December U.S. Dollar options have 42 days left until expiration. March U.S. Dollar options have 126 days left until expiration.

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