Fuel Hedging using CL Call Options

[ogarbitrage]

No thank you.

 

[OddTrader]

Quote from ogarbitrage:

No thank you.

Never mind! Perhaps the clients of your firm would!

 

[ogarbitrage]

They're in better hands than this thread.

 

[OddTrader]

Quote from ogarbitrage:

They're in better hands than this thread.

Would you like to post your live calls as well for comparison?

 

[ogarbitrage]

What live calls can I make? Our clients structure their hedges utilizing a variety of OTC products depending on their needs and time frame.

Once again, you are not hedging anything. You are buying calls for no specific purpose and calling it a hedge.

 

[OddTrader]

Quote from ogarbitrage:

What live calls can I make? Our clients structure their hedges utilizing a variety of OTC products depending on their needs and time frame.

Once again, you are not hedging anything. You are buying calls for no specific purpose and calling it a hedge.

I simply provide a hedging strategy! Perhaps becoming a competitor of your firm!

 

[ogarbitrage]

Quote from OddTrader:

I simply provide a hedging strategy! Perhaps becoming a competitor of your firm!

Wow, you're providing a "hedging strategy" so well known that it's defined on almost every amateur investing website, and despite this, you manage to misinterpret it's use as a hedging vehicle.

I am fearful for our market share.

 

[OddTrader]

Quote from ogarbitrage:

Wow, you're providing a "hedging strategy" so well known that it's defined on almost every amateur investing website, and despite this, you manage to misinterpret it's use as a hedging vehicle.

I am fearful for our market share.

Don't worry too much Yet! Still far too early.

You/We will see!

Quote from OddTrader:

Think I have done enough backtestig of CL market for Crude Oil futures. Here is another experiment as I would like to know the cost of hedging.

Basically my conclusion is quite similar to what Lee Hong Liang mentioned in his article "Unraveling the Hedging Maze" that: Vanilla (options?) have in most cases proven to be the most successful tool for hedging. ... An alternative would be to purchase a call option. Call option is essentially buying price risk insurance.

Now I would like to post the upcoming signals on weekly basis for hedging CL. The strategy is to buy Call options only, for always keeping a long Calls position.


http://www.elitetrader.com/vb/showthread.php?s=&postid=3324658#post3324658

 

[OddTrader]

Quote from OddTrader:

Don't worry too much Yet! Still far too early.

You/We will see!

PS: Based on the positive feedback above, I guess I must have done somthing Right!

 

[ogarbitrage]

Quoting yourself is positive feedback? That explains so much.