It's not a backspread - in a call backspread you sell the near strike and buy the far strike x 2. Same for a Put backspread. I don't believe...
Thanks guys. I'm gonna make squillions $$$ £££ !!!!
Can somebody tell me how to calculate future volatility please ? TIA
A basic / elementary introduction to options. My suggestion for any newbie would be to read this one first, then his bible. I had (wrongly)...
polpolik You havenât said how far apart the strikes are, but assuming they are the same distance in both spreads, then Spread 2 will always...
Try the search function on this site....
You have to ask yourself, why then doesn't everybody do it ? Anyway, that debate has been done to death here:-...
Yes you could use monte carlo, but I find it too long winded for the same result which can be calculated by formula. I constantly use...
The formula is quite complicated, I'll see if I can dig something out. But my understanding is that the probability of the underlying touching a...
Whenever we trade we have to pay a spread / commission / clearing fees. Whenever we trade we lose edge, so my philosophy is to adjust (trade) only...
The best way, by far, to make money selling options is....to write a book telling people to sell options :D They do say there's one born every...
Anymore ?
So selling options 2 or 3 sd OTM is called "market profile" trading ? That's a new one on me. Thanks.
Excuse my ignorance, but what exactly is the "market profile" way ?
Then allow me to re-iterate.... For options that settle into cash or stock the futures value as traded in the market is a good approximation to...
I hadnât considered the case where options settle into futures contracts, and concede your point regarding the forward value of those options....
Exactly. Logically then, the futures value (as seen in the market place) will be the forward value of the underlying. Not so. If the futures value...
Isn't that what I said (excepting continuous compounding) ? If you really want to split hairs then how does your formula account for the interest...
Forward value = cash + risk free interest rate - future dividends. But estimating future divs on the index constituents ain't easy ! It...
You need to look at the forward value of the DJX, not the cash value. The delta values will then make sense.
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