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I'm not sure I understand this strategy. 1) You're selling diagonals, not calendars with the strategy you describe above. 2) If you're only collecting premium on the last 7-10 days before expiration, you will definitely lose on the leaps. (theta may be small, but on $100 options, it...

You're pretty far off on many accounts. 1) You cannot "exercise" a sold option. Only the person who bought it from you can, and he can do it whenever he feels like it. 2) The profit you describe occurs only if DNA rises to 85 or above and stays there *at* August expiration. If it happens...

Any decision? Are CME pit options actually supported by IB? Your customer service people still say no. If so, which are supported, and how do I get quotes for them? Live Cattle is still reporting no prices for any options.

I agree with many of your other points. However, a *covered* call has the same risk profile as a naked put. A rally makes you a fixed profit. A decline has "unlimited" risk. Sure, you've hedged a tiny bit with the option premium of the sold call, but it's the same as the premium of the sold...

Just to blow your mind... A covered call is exactly the same as a naked put.

It's almost never worthwhile to exercise a call (exceptions include OEX, dividends, and a few other rare cases). There will still be time value left in the option until the last few days before expiration. In other words, you could sell the option for more than the profit of exercising would...

My language was confusing, I apologize. If GOOG goes up or nowhere, you'll profit $7 in 11 days, but you could conceivably lose $13. (You'll pocket $20, but you spent $13 to get the position)

Wow, you guys need to train your customer service people. They insisted pit traded options were not available when I asked just last week. On what market can I get pit traded option quotes? I'm currently looking at Live Cattle (LE), August options on the August futures. There are no quotes on...

Hi Don, Two points you might not have considered: 1) An at-the-money call is expensive. Every day, you will lose money on it. As an example, a July 420 GOOG call is going for $14.50. If GOOG goes nowhere today, that call will be worth $13.92 tomorrow. 2) An at-the-money call does not...

The carrying fee can add up with options. I guess it all depends on how long you're holding. 30 days isn't unusual for me, adding up to $3 per contract. The bundled rate eliminates that.

Pit traded futures, not pit traded options.

On the plus side, this sort of one-market move is likely an arbitrage opportunity. If you can suck up mini contracts below market, and sell full size at the market, you've got a mostly risk free arbitrage. CME has an electronic mini-corn contract which I believe has an average daily volume of...

Have you tried any grain trades since you posted this 2 months ago? How were your experiences? IB lists floor corn as supported, but then lists the electronic contract (ZC) as the symbol. Battle: Primarily market or limit orders?

Why stop at copper? Perhaps newbies should trade nothing and go back to their "real jobs". At least EliteTrader's namesake Elitism is alive and well everywhere.

IB does not do floor options.

That was supposed to read 'Grains and Meats'. You know, Metal... Meat... Similar letters, just in a different order. :-)

I'm looking for a good, stable, cheap (perhaps that's a pick 2 out of 3 thing?) broker which can trade floor options (particularly on Grains and Metals) at CBOT and CME. IB can do electronic options only for specific markets. RJ O'brien is $7 each way. Any other suggestions? Good...

Today alone, 7580 57.5s traded, 6998 52.50s. Leak this trade out over a couple days, and I don't see much of a liquidity problem for these quantities.

I think I can do at least one better without any margin impact: 55 call butterfly costs .55 (assuming no price improvement). If I followed your math right, your $100k would be $354,545 in a month. But there's at least another opportunity. MRVL has a beta of 3.74 and a 54% correlation to...

The best bet? Are you sure? Just to use your numbers, buying the 52.5C at ".05" and selling the 55C at ".01" would be a 20% better bet if the price will hit 55 at expiration. If it hits 55 tomorrow, then no doubt you're correct (vega + time value). If it hits 55 at expiration, then my +52.5C...