Hello,
I have spent a LOT of time researching options futures trading the last 48 hours, and still am having some trouble with things. I'm going to try my absolute best to ask these questions as best as possible and sincerely thank whoever helps answer them in advance! I've specifically been considering straddle positions.
For the sake of the questions, I'm going to refer to the uploaded image, which shows Options Chain prices for CRUDE OIL (CL) Jan 2021.
1) Why are some calls/puts missing? And, why are a lot of strike points varied/missing?
2) I plan on trading futures options on InteractiveBrokers, probably mostly the NYMEX. How do I know, or can be sure that these are American Style options, versus European and can exercise at any time?
3) I am very interested in exercising a straddle position in the next few months, or even potentially much further down the road. Using the image attached, let's assume I make a straddle position in the 12/16/20 CL option at strike price of $25. 2 calls and 2 puts. Let's say they execute at the current price of 11.06 (calls) and 2.53 (puts), for a total 13.59.
3A) Does this make my break even points for CL Jan 2021 (not including trader fees) $38.59 for the call, and $11.41 for the put?
3B) If the price in the next 5 months shoots up, and I exercise the calls at $50 for both call options, what would the profit be? If things get extremely volatile and I exercise both calls at $50, then the price shoots back down to $20, can I also exercise the puts at a different time and make money on both the calls and puts?
3C) What's the easiest way of executing this example trade on InteractiveBrokers Trader Station?
3D) To close long straddle calls/puts its to my understanding that I simply sell back the positions, is that right?
3E) How would I setup automatic triggers to close said positions at a certain point, like a limit or stop in a stock sale?
3F) How do I calculate the total cost/margin of the example trade above?
4) Is there a good calculator/chart tool that can help in executing a straddle position on futures options? Break even points, P/L calculations, etc?
Sorry, I know that's a lot but I just am trying to be as clear as possible and researching doesn't seem to have specific answers/solutions to the above.
Thanks!
Jimmy
I have spent a LOT of time researching options futures trading the last 48 hours, and still am having some trouble with things. I'm going to try my absolute best to ask these questions as best as possible and sincerely thank whoever helps answer them in advance! I've specifically been considering straddle positions.
For the sake of the questions, I'm going to refer to the uploaded image, which shows Options Chain prices for CRUDE OIL (CL) Jan 2021.
1) Why are some calls/puts missing? And, why are a lot of strike points varied/missing?
2) I plan on trading futures options on InteractiveBrokers, probably mostly the NYMEX. How do I know, or can be sure that these are American Style options, versus European and can exercise at any time?
3) I am very interested in exercising a straddle position in the next few months, or even potentially much further down the road. Using the image attached, let's assume I make a straddle position in the 12/16/20 CL option at strike price of $25. 2 calls and 2 puts. Let's say they execute at the current price of 11.06 (calls) and 2.53 (puts), for a total 13.59.
3A) Does this make my break even points for CL Jan 2021 (not including trader fees) $38.59 for the call, and $11.41 for the put?
3B) If the price in the next 5 months shoots up, and I exercise the calls at $50 for both call options, what would the profit be? If things get extremely volatile and I exercise both calls at $50, then the price shoots back down to $20, can I also exercise the puts at a different time and make money on both the calls and puts?
3C) What's the easiest way of executing this example trade on InteractiveBrokers Trader Station?
3D) To close long straddle calls/puts its to my understanding that I simply sell back the positions, is that right?
3E) How would I setup automatic triggers to close said positions at a certain point, like a limit or stop in a stock sale?
3F) How do I calculate the total cost/margin of the example trade above?
4) Is there a good calculator/chart tool that can help in executing a straddle position on futures options? Break even points, P/L calculations, etc?
Sorry, I know that's a lot but I just am trying to be as clear as possible and researching doesn't seem to have specific answers/solutions to the above.
Thanks!
Jimmy
