Option trade ideas

XM,

What is your opinion of the following trade?

Sell EUR FOP (6E) Jun05'15 1.14 PUT @GLOBEX
Buy EUR FOP (6E) Jul02'15 1.14 PUT @GLOBEX

J_S
 
Np. I can only chart the underlying futures spreads. Options spread charts require a subscription to CQG IC and possibly the spreader product.
 
Haven't been active in currencies.I really want to approach trading the underlying in a systematic manner. My pseudo-research indicates there is no money to be made.

For your spread, Check out volatility.

upload_2015-5-7_15-14-1.png
 
Thx XM,

I am trying to get a handle on understanding the volatility charts and what they might indicate. Interesting stuff.

For learning purpose I will post some values here and we will watch the trade develop - it will be interesting to see what transpires.

J_S
 
The only difference between exchange traded spreads and options spreads is your volatility outlook. However, the underlying's forward curve is probably a bigger determinant of profit/loss.

Check out the ag trade ideas thread with Tradator and FCX_Options.
 
FX Option Trade Monitor

EUR.USD Cash = 1.1326

Take worst case prices as follows.

Sell 1 x EUR FOP (6E) Jun05'15 1.14 PUT @GLOBEX for 0.0255
Buy 1 x EUR FOP (6E) Jul02'15 1.14 PUT @GLOBEX for 0.0304

Cost = 0.0304 - 0.0255 - 0.0049 = $612.50 Debit

J_S
 
It will be interesting to see what transpires XM, as I have taken worst case price for spread to open trade.

I will post chart of actual spread midpoint v.s cash price.

Question. How can you have unlimited loss with spread on same strike?

I need to get the prices into P&L graphs - any useful excel file suggestions?

J_S
 
A horizontal spread has the same pnl graph as a straddle except the losses flatten out at the extreme. You might as well consider it unlimited loss because by then..the spread has blown out. Don't do options without any PnL and volatility modeling.

For Excel, Hoadley is well regarded and only $100. Optionstar is Excel option no. 2. Free data connectivity for any Excel based software can be a minefield, so demo it first. Next up the food chain is web based Quickstrike through the CME. Really good stuff.

You should shop around IB's and FCM's and see who can give you the platform+analytics within your budget. Everything is negotiable if you do enough trades.

Perhaps, some nice person will demonstrate IBKR spread modeling functions.
 
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Just remembered. You can use TWS Option Strategy Lab to scan strategies based on your outlook and then use Risk Navigator to model the trade.

Unfortunately, TWS was designed with it's CEO's paradigm of trading. I can only surmise that he is one twisted individual.
 
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