Search results

Thanks for the clarification. I was always puzzled by this.

Some people do just that (ES for SPX, NQ for NDX) while others use options of different strike or expiration date to hedge.

I was reading the contract specification you quoted here but was not able to fully understand that it means the settlement value will be different from the index. Now I understand it but this doesn't make much sense to me as what's bad about just use the index? Would that make thing easier and...

The NDX index last Friday had a high of 1550.63 and low of 1532.56. NDX June contract settlement value however is 1553.96 (CBOE). Is the settlement price the average value of the first five minutes last Friday? How can the average be higher than the High of the day? What am I missing here?

I always use SMART and have little more orders get filled at ISE than CBOE. I would believe SMART had picked the better price for me most times, if not all the times. But I don't know it for sure. How do we know which one has better price. Is it a matter of personal experience/opinion, or it is...

When we talk about pit traded, we tend to think the (grain) pits in CBOT which you can not trade from IB. CBOE is several years ahead of CBOT when it comes to make their market more electronically accessible. You can trade all CBOE contracts from IB. Yes contracts are fungible among...

If you take a longer view from a historical perspective, the burst of housing market, not just US but worldwide, is a 100% sure thing. History just keeps repeating itself. The timing could be off a few years, but when you look at it in a longer view, a few years is really nothing.

I am sure the Sarbanes-Oxley will be water down pretty soon. Some of the measures are plain stupid!

Helicopter money (helicopter.gif) from financialsense.com

In the summer of 2003 when the Fed was very concerned about deflation Greenspan said something like (since the Fed fund rate was close 0%) Fed could buy long bond and some other unconventional methods to fight deflation. Is this kind thing we are talking about here?

Please forgive me for my ignorance. I heard Mr. Bernanke talking the other day on Bloomberg. All I know is that he's leaving Fed. Govoner position and to head the White House economic council. I don't remember any of his position on various issues alarming to me. Would you elaborate what kind...

You certainly answered my question. Thanks.

I understand that one has to have a good "feel" of the underlying in order to be profitable in selling premiums (I don't tracking S&P as close as I do to NASDAQ. Otherwise I'd be able to appreciate your journal more thoroughly. ) It seems to me that because my credit vertical spreads are much...

The bid/ask spreads of NDX options are much smaller than those of SPX options. Does this have something to do with the fact that NDX and MNX options have multiple listing (CBOE, ISE, etc.)?

These underlyings are either S&P 500 or S&P 100. Are there any particular reasons you don’t like NASDAQ options (e.g. options on NDX or MNX, or options on E-mini NQ futures)? Would you comment on NASDAQ options? Thanks.

The official real GDP growth rate in the US is around 3.5% in the past few quarters. The official inflation rate of 2.5% - 3% is said to be understated by some experts. Many service sectors' inflation is more than 7%. Depending how you want to weight the composite inflation index, we might be...

That's why the new bankruptcy law this year. The homestead clause is modified that unless you’ve been living in the house for two or more years, your house is not protected by bankruptcy. Other new measures in the new law will have about six month “grace period” if you will, but this...

This is the most compelling evidence of housing market bubble. The Ratio of housing price to rent is similar to the PE ratio of stocks.

One thing people complained about is when we buy a PC with 3.3 GHz speed that costs the same as a PC of last year that had a speed of 2.2 GHz, the index will show a decrease of price. This makes some sense although your out-of-pocket money doesn't decrease. What I think is happening is that...

That’s one of the important things to keep in mind when we speculate when Greenspan will end the tightening campaign. After the equity bubble burst in 2000, he defended himself by saying it’s better for the Fed to let the bubble burst itself and clean up the mass afterward than to take a...