Search results

The best part of options trading is that you can "have your cake and eat it too", so my point is that it's not a bad strategy to trade overlapping calendars and butterflies on the same underlying, because the vega risk is minimized and the probabilities increase.

I have been thinking about a strategy for playing a range bound sideway underlying that involves putting on a calendar on the bottom of the range with a butterfly towards the top. Instead of having an exact price target, I have a price range where I want the underlying to hang out. By combining...

I understand that differences in how a calendar vs. butterfly react to changes in vega (volatility), but my primary concern is keeping the underlying within my break evens. I'm using a strategy where I can get at least 66.6% probability (I assume based on IV), that the underlying will stay...

I've been testing calendars vs. butterflies, and I find that calendars offer slightly better risk/reward, but lower probability. I'm using MSFT, comparing a July Call butterfly (29/33/37) vs. PUT Calendar (sell 33 July, buy 33 Aug). Is my observation true across the board, or is it related to...

What I wrote above is as far as I can tell, an example of arbitrage. My question is, has anyone found arbitrage in other markets in 4/5 deep in the money back spread ratios combined with buying an at the money put? It seems too good to be true.

I just made an observation, and I am wondering if and how it is correct. I trade options in Israel on the MAOF TA 25. I have 2 possibilities. 1) BUY OCT 1230 CALL for 1360 SHEKELS 2) SELL 4 OCT 1180 CALLS, BUY 5 OCT 1190 CALLS for a credit of 515 shekels, and buy the 1230 PUT for debit of...

The most conservative options income strategy is probably calendar spreads, sell an ATM call or put about 40 days out and buy the same strike price the following month. This strategy takes advantage of theta (time decay), and your risk is limited to basically what you pay for the calendar. You...

"There are some companies in the UK that offer something they also call "binary options" that seem a lot more like the gambling stuff you are talking about. These are the ones that can't be traded out of and have weird rules like "winning 85%" when the trade works, and "winning 15%" when the...

What do you mean exactly by pricing inefficiencies? Do you mean on the underlying? My impression is that these binary options trading firms are nothing more than online casinos using the underlying assets and the term "options" as a way of fooling people with no financial background into...

I'm looking for a Prop trading firm, but I only trade various option spreads. I do hold positions overnight, b/c this kind of options trading strategy needs to be held for at least a few days. I had 10:1 margin on options for a 10K account back in 2006. The profit split was 70/30. Can anyone...

With the explosion of so called "Binary Options investment firms", I am surprised that there hasn't been much discussion about what exactly these companies are. From my observation, they are basically a kind of on line casino. When Hedge Street opened as one of the first on line binary options...

I've been trading options for a long time, and now I'm looking for a broker that will give me some margin beyond the nornal requirement. Another words, I'd like to put down 20K and get 100K in buying power. 4:1 margin is normal for day trading, but I can't seem to find brokers that will give...

I have a question. Given that the spreads on ICON GM Forex options are 10 pips, is there any use for trading these options? I'm generally a positive theta trader (I like to sell option premium on out of the money options and pick up theta). But when I'm wrong, I need to close out the...

I'm thinking about some combination of straddles and strangles on forex plain vanilla options to stay delta neutral and pick up positive theta. I realize that selling strangles alone is not recommended on these options. Can someone comment on the following strategy. Sell an at the money...

Are you putting on various OTM spreads a month out and adjusting them? Do you have that "edge"? I realize you many not want to give away your "secret", but I can't figure out for the life of me how I can consistently make money with 10 pip spreads (or 8 in the case of SAXO), since from the...

My experience is entirely with trading options on ETF's, stocks, and indexes. I'm discovering that the world of FOREX options is an entirely different universe altogether. Is it fair to say that it's not recommend to trade FOREX options without using a strategy involving SPOT? Selling...

What are FOP's?

Do you mean it's preferable to sell ATM straddles on Forex options as opposed to OTM stangles? Would I get tighter spreads on ATM straddles? (Perhaps as low as 15 pips?) I still can't resolve this problem: On the IKON GM platform, PIP quotes on Forex optionsa re ALWAYS 10 pip spreads...

If I'm interested in trading mainly Forex vanilla options, are my only choices Saxo Bank and IKON GM? This seems to be what I'm finding from my research. Why isn't there more discussion on Forex option trading? DO retail Forex traders tend to favor trading Spot over Options? Thanks, Eric

I'm not sure about the clearing, I thought it was IKON GM. I was referred to them by based in Houston (CFOS/FX). They told me they use Saxo and Ikon GM, but Saxo doesn't allow opening an account with anything less than 10K or perhaps 5K and they charge per ticket...