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As an aside, since you're in the EU, you might want to look at KOSPI options. Very tight spreads that makes daytrading possible. (Otherwise, a $1 option with a .10 spread still requires a 10% move just to break even)

Convexity. (Although obviously swaps have convexity issues as well, depending on what you're swapping) If you're trying to only trade "something cheap", you're setting yourself up for pain. Buying $1 options because that's all you can afford implies all sorts of things about the probabilities...

Probably not. But, surely ToS isn't that hard to reach and ask this question?

It depends on the quote source. Corn, for example, is currently 263 cents/bushel. The multiplier is $50. Sometimes I've seen Corn quoted in dollars and cents/bushel (2.63), which would make the multiplier $5000.

Wheat is rallying steeply thanks to fairly poor crop conditions worldwide and lots of demand (including a giant order from Iraq that's still rumored). Wheat has gone from 390 to a high of 455 in 11 trading sessions. Corn has a great crop, but is still rallying due to expected ethanol demand...

CBOT is the exchange. I have access to them through IB. The liquidity is great. Spreads are rarely more than 1/4 (a tick) on wheat, and corn is even deeper. Volume today: Wheat: 29K Corn: 85K Soy: 25K Soy Meal: 5.7K Soy Oil: 5.6K That's not bad seeing as how ER only has 92K...

The new electronic grains futures look good enough to day trade. Lots of liquidity, lots of movement. They're worth a look for anyone who's trading futures. Corn, Soy, Wheat Maybe soy meal and oil, but I haven't looked at them yet.

Can someone on the floor at CME describe what the lumber pit is like these days? I've seen some really bad pricing behavior and am wondering if it's bad luck, or a bad scene.

Wheat, Soy, and Corn are all going crazy. Wheat in particular. You've just got to find the right markets.

People love overleveraging options. I bought those same calls yesterday, and they were going for .40. It wouldn't surprise me someone said, "I can make $40,000 if it doesn't go above $100!" How many times have we seen this exact same flawed "analysis" here on ET? Still, I think it's much more...

I'm confused by this. Rollover only happens each quarter (and has already happened on 9/15), expiration happens on the 3rd Friday of the month. Neither of these would account for an upside bias at the end of the month. What upside rollover bias are you referring to?

These are generally caused by a split or other one-time share adjustment. They get weirder--some options exercise into a long and a short of two different equities (happened this year to me with a call), or a long and cash. Be careful, you'll sometimes see options that are "too good to be...

Options may not be right for you under the first analysis. If you believe the fundamentals are good and want to take advantage of price spikes, then just buy the stock. The catch with options is that you have to be right about both direction AND time (and to some extent, Implied Volatility)...

A few google searches turns up IMH which is optionable and invests in "non-conforming" mortgages (i.e. high credit risk) I'm sure there are more. Expanding beyond REITs seems trickier--the closed end funds that invest in corporate junk debt so far have not been optionable.

Forget GNM, I meant FRE.

On the high end, you can spread eurodollars versus treasuries. Another thought is spreading FNM or GNM vs treasuries. I don't think you can easily find puts on MBS's, but that would allow you to play the lower end. (Of course, you can find exotic options makers in practically anything, so...

Depends on the day. On Fridays and Mondays, you'll get some quantum effects in theta. Otherwise, on US options, it's virtually impossible to see any intraday theta until right before expiration. With spreads of at least .05, the bid may be an IV of 30%, and the ask an IV of 32%--wider than theta...

Just some thoughts. Take 'em or leave 'em. 1) Why the heck are you trading '08 options? The spreads alone will kill you on highly illiquid LEAPS, and the deltas are practically non-existent. If you had traded Octs or Novs ('06), you would have done very well. 2) A vertical is not "more...

Fin-Hype 2K6 is amazingly prolific. http://club.ino.com/discover/ http://www.deltaneutraltrading.com/?hop=acommodity Not to mention http://www.insideoptionsletter.com/ Am I the only one who thinks this is a computer program spitting this stuff out?

Are these verticals, or both long?