Wait, what? You giving us two 10bp ranges for this Friday close? that's brave...
Can I make a bet that it will NOT end in your ranges (neither between 211.71 and 211.51 nor between 208.49 and 208.29)?
Expiration Friday trading
- Thread starter TradeCat
- Start date
Can I make a bet that it will NOT end in your ranges (neither between 211.71 and 211.51 nor between 208.49 and 208.29)?
Right, so as I said, I am willing to bet that it's not gonna be within 10 cents to EITHER of the two numbers - you giving two 20c-wide expiration ranges ("give of take a dime"), I am willing to take the other side
I'll bet sushi dinner in Manhattan, choice of the winner?
Right, so as I said, I am willing to bet that it's not gonna be within 10 cents to EITHER of the two numbers - you giving two 20c-wide expiration ranges ("give of take a dime"), I am willing to take the other side
I'll bet sushi dinner in Manhattan, choice of the winner?
So are you for the long SPY 210.00 straddle or short SPY 210.00 straddle?
EDIT: My post #20 states they both will break even when they expire. Unless the market moves beyond what is priced into the SPY ATM options.
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I don't see how your prediction has anything to do with a straddle. You said (and I quote): "one OR the other at expiry- $211.61 OR $208.39 - plus/minus a dime". Translating it into a payoff would give us two double digital options:
OptionGuru Bet = $N * if(SPY > 211.51 and SPY < 211.71) + $N * if( SPY > 208.29 and SPY < 208.49)
I want to take the other side of that bet, please - so my payout would be
sle Bet = $N - OptionGuru Bet
I am offering that we make the notional ($N) a sushi dinner in a restaurant of the winners choice.
OptionGuru Bet = $N * if(SPY > 211.51 and SPY < 211.71) + $N * if( SPY > 208.29 and SPY < 208.49)
I want to take the other side of that bet, please - so my payout would be
sle Bet = $N - OptionGuru Bet
I am offering that we make the notional ($N) a sushi dinner in a restaurant of the winners choice.
- The market doesn't reward dumb money - making it difficult for both sellers and buyers to profit.
- The ATM straddle is priced to break even for both sellers and buyers.
- For the sellers or buyers to profit the market must move beyond what is priced into the options.
- The buyers want a bigger move - the sellers a smaller move.
Forget OI and focus on the premium for the ATM straddle. The market doesn't reward dumb money and will make sellers and buyers earn their money.
Example:
- SPY at 209.99.
- SPY July 08, 2016 210.00 Call (bid $0.71 ask $0.76).
- SPY July 08, 2016 210.00 Put (bid $0.90 ask $0.91).
The above quotes show that the SPY will trade in a price range of about $211.61 to $208.39 until expiration, and on expiration finish at about $211.61 OR $208.39. Both traders will break even unless the market moves beyond what the option premiums indicate - in that case one of the traders will profit.
- A strangle buyer will pay $1.67 and needs the SPY to finish above $211.67 or below $208.33 to make a profit.
- A strangle seller will collect $1.61 and needs the SPY to finish in between $211.61 and $208.39 to make a profit.
Long story short - This Friday the SPY will close at $211.61 OR $208.39, give or take a dime.
Feck you OG anyway, as I said I was going to T2W after a mod stopped me posting in another thread where I tried to highlight con men, but so be it, I do as I like
Lets have a little competition then and see who gets the closer - interesting take btw!
SPX will finish on Friday between 2050 and 2075 - these numbers may change due to volumes traded between now and Friday - will update tomorrow evening, and on Friday.
SPY is a bit harder, but here goes - finish between 210 and 211 - funny enough they are close to your numbers, and will change due to volume traded by Friday as mentioned!
This should be interesting - but will need a few weeks to see how we get on?
J_S
Don't waste your time OG, just do as I do and tell them to "fuk off and don't be annoying me"
Back to business
What about the straddle on diff days - say, what about the difference in atm straddle on Mon versus Wed, as market makes its moves?
It's been a long time since a post has got me seriously thinking, so, at least you have achieved that - now let's see who is closer to finish price for Friday - I hope you are btw
J_S