USO , huge discount

Thanks for the news about USO options. I started trading them on Tuesday. Not a whole lot of volume, impossible to get a fill inside the big-ask spread, and the MM's standard spread on options in the $1 range is .15. Still, being able to buy puts is lovely. I was hedging my long QM holdings with OIH puts, but OIH lately seems to follow the overall market and the spark spread more than it does crude.
 
Quote from loufah:

Thanks for the news about USO options. I started trading them on Tuesday. Not a whole lot of volume, impossible to get a fill inside the big-ask spread, and the MM's standard spread on options in the $1 range is .15. Still, being able to buy puts is lovely. I was hedging my long QM holdings with OIH puts, but OIH lately seems to follow the overall market and the spark spread more than it does crude.
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yeah, I like USO, the option spreads are painful but should tighten as volume picks up. Deep OTM call may be a nice insurance policy.:)
 
If it were me, I wouldn't own this, it's too volatile. However, oil and oil related is probably a good investment now. One major hurricane on the East Coast and it will go up like crazy.

I suggest IEZ or PXJ
 
Doral, what do you think of XLE and OIH? They have a few components that comprise 10% or more of the index (IEZ has the same issue - SLB is 21%). I actually prefer an index that more closely tracks the prices of oil, nat gas, and gasoline and is less affected by company-specific issues.
 
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