Are there options available for calendar spreads on gold?

Discussion in 'Commodity Futures' started by njchino371, Dec 5, 2008.

  1. I know options on calendar spreads are offered for crude oil, but from my searches I haven't found anything for gold. I just want to confirm for sure that no such product exists. Thanks.
  2. There are Gold options traded on the CME exchange under the symbol ZG . The bid/ask is somewhat wide but its tradable if one can wait for big moves. What sort of calender spreads do you have in mind?
  3. I wasn't actually referring to direct options on gold futures. I was referring to options on calendar spreads that are set up with futures. Essentially, I want to be betting on the price spread between near month and further month contracts with options. For example, say the calendar spread is between January '09 futures and January '10 futures. If they offer options on that spread, with a call I would be essentially longing the '09 and shorting the '10 (with positive strike price) and vice versa with a put (with negative strike price). But I'm pretty sure this product isn't offered because gold rarely, if ever, goes into backwardation, unlike oil.
  4. There would have to be considerable liquidity for any Market Makers to exist for what you suggest (like CL or ES). Otherwise, the closest thing I could think of would be to do a future option combo using a near month and the furthest month (which is only about six months for ZG).

    PS: "CME Exchange" is redundant. Reminds me of that old splash-screen: NT Technology
  5. Div_Arb


    Firs post on ET and you are already giving advice, huh.. How does that quote from Casino Royale go, something like "Why is it that people who can't take advice always insist on giving it".
  6. Yeah because gold's in contango for the most part, options on calendar spreads aren't as useful for hedging. For me to put on the position I want synthetically costs too much.