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Where did you get 30% from? The current dividend yield on FRO is 18.39%.

The strategy you're talking about is called an Iron Condor. That is, you're selling an Iron Condor. It consists of a OTM short call vertical and an OTM short put vertical. You maximum profit is limited to the intial net credit received and is achieved if the stock is between the short strikes at...

You can't use just a simple NPV calculation to value options. It is, however, part of option pricing models, such as the Binomial Option Pricing Model.

Are you asking about mini-SPX (XSP) or weeklys? You post seem to be mixing the two together. If you're asking about weeklys then the answer is quite obvious - options will be only for the next week, otherwise it defies the purpose of the weeklys.

Thinkorswim, but their commissions are higher. (They do make it up in other areas, though)

Actually, mini-SPX options will be the same to SPX options, as MNX options are to NDX options. But you're right, mini-SPX wil be to SPY, like DJX are to DIA, or is it the other way around....:confused: Is that confusing or what!? :D

I guess they couldn't get an Airbus 380, so they had to settle for a small jet!:D

Unless you exercised early you American-style options to lock in gains, I don't see how it would be different with European-style options!? :confused: True, with index options you don't have the exact underlying, but this problem has nothing to do with options being European-style.

Actually I was referring to selling straddles/strangles not credit spreads. You have a much bigger risk with short straddles/strangles than with spreads. In a spread your risk is limited no matter what and while a huge gap can wipe out months of profits, that same gap in a short...

Andysmith, It's called gap risk! No amount of discipline will save you from a gap.

The Greeks won't be affected, the weeklys will have the same Greeks that "normal" options have in the expiration week. It will be just like expiration week is taking place every week.

No, they won't be any weeklys in expiration week. The first link clearly states that: "...except that no Weeklys will be listed that would expire on the third Friday of each month (expiration week for standard options)."

Just add up the individual Deltas and you have the spread's Delta. For example, long call Delta 0.3, short call Delta 0.5. Spread Delta is -0.2 (0.3-0.5=-0.2).

Yes, it is very theoretical and academic. Just Google it and there's a ton of academic stuff on it.

You may wanna try the exchange, you might have a better chance of getting a fill there. The market here on ET is very illiquid and the bid-ask spread is huge as you can see. :D

There's no such thing as a risk free high return strategy, except for arbitrage of course but that's different. Without risk there's no return beyond risk-free rate!

There's nothing to discuss, it is a classic strategy of getting market exposure while ensuring that 90% or whatever proportion is locked away in a risk-free vehicle.

Yes, you have 225% of your intial capital in your account, but the return is 125%.

Actually, 7% per month is 125% per year compounded, not 225%.

Yeah, I wanna see those too. I don't care about the picks, I just wanna see that guy! I heard he's very entertaining.:D