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As pointed out above, it's caused by the fact that you cannot exercise a European option prior to expiration. The minimum value of a European-style put is equal to: PV(X)-S, where PV(X) is the present value of the strike S is the current underlying price The more time to expiry the...

I suggest you ask etrade whether they do offer them or not. Otherwise, thinkorswim offers them as well.

You can see the margin comparison in the link provided by weewilly. Also you can see what the margin requirement will be under PM for any position you like by visiting this page and clicking on "Launch the online position editor" button. towards the bottom of the page. It's not easy to find the...

The margin under PM on an iron condor is less than 1/3 that of the Reg T., so there is quite a bit of benefit. I do agree though that a person should not leverage up too much.

No such thing as free money! Think otherwise and you are setting yourself up for a very nasty surprise one day.

Unless you are on Portfolio Margining the short call would be considered naked and thus would carry the margin requirement of a naked short call as it expires after the long.

1. The forward price has two components - spot price and cost of carry (cost of carry consists of carrying costs less any income received by holding the underlying asset). When you enter into a forward contract to buy some stock at a future date then essentially you are postponing the payment...

This is a high probability strategy, but it's far from "almost" risk free. It's called collecting pennies in front of a steamroller. It works until it doesn't and the loss wipes out months if not years of profits.

There is no right or wrong way of doing this. Some people buy further OTM, others buy more contracts at the same strikes, yet others may do a combination of both. It's up to you to decide which method is more comfortable for you, and the best way to find out is to try it yourself, either with...

They are not hard to close if you are willing to pay the full spread, which means significant slippage.

On a side note, if you are planning on buying the stock just so you can do a covered call then consider selling a put instead (e.g rather than buying the stock and selling a 5 call just sell a 5 put). It's exactly the same payoff with half the costs.

First of all, cash indices close at 4pm, while the options trade till 4:15, so that 610.96 doesn't reflect the slight drop in the futures after 4:00 while the options do reflect it. It doesn't really look all that weird. Just look at the SPX options for example. SPX closed at 1075.63, the...

The second part of the text regarding the calculation of the settlement price in the link is wrong! Here's the text from CBOE's website, contract specifications for RUT options: "Exercise will result in delivery of cash on the business day following expiration. The exercise settlement...

Your risk is that the stock drops to zero (worst case). If the stock drops to zero then you lost 690 on the shares and collected 320 on the call, so your net loss is 370.

Yes, there is a factor in B-S to account for supply/demand. It's implied volatility. If the supply is greater than demand then the option price is pushed down and so is the implied volatility (assuming everything else stays the same). In other words, implied volatility is nothing more than a...

Here's what I see in time&sales. @ 2:20 the bid was 4.20 (IV around 30%). @ 2:22 there were 2 trades totalling 100 contracts @ 4.17, and then several more for another 50 cons in total @ 4.18, with the market being 4.10 bid at 4.20. @ 2:35 there were several trades totalling 184 cons @...

Delta of 1 means that for each point move in the underlyling the option moves by 1 point.

It's a simultanous equations problem.

Options on currency futures.

What pilot program are you referring to? Weekly options have been available for a long time now. I'm sure IB offers them as well (I don't use IB), you probably just don't know how to get to them or cannot see them.