Currency Futures Options

Discussion in 'Options' started by cloned777777, Aug 30, 2005.

  1. plus loss from the premium for the bought put...

    but better than stop loss slippage..

    ( the idea of buying call is a good one also )...
    but i am doing totaly something else here
     
    #21     Aug 30, 2005
  2. I never bought a call...when did i say i bought a call ?

    i bought a put to protect my long position..

    correct me if i am wrong.

    thats why i am here..
     
    #22     Aug 30, 2005
  3. Maverick74

    Maverick74

    You don't understand. You are long a synthetic call. I'm not telling you to buy a call, I'm tell you that is what your position is. You are long a call that is now worthless. There is nothing to hedge!
     
    #23     Aug 30, 2005
  4. Maverick74

    Maverick74

    Long Put + Long Underlying = Long Call
     
    #24     Aug 30, 2005
  5. palawan

    palawan

    the confusion that i have is that you said that you're already long and profitable at 1.2200. then you wish to protect it by buying a put at 1.2200 but you're concerned that the options available are European and cannot be exercised at any time except at expiration. no problem.

    put = short the underlying + call

    what you really want is to have a risk free way of cashing out your profit but still make more money if there's more upside to go.

    so, you want to short the underlying and buy a call (put) or in this case, sell your position and buy a call.

    maybe i got this wrong, as i'm mostly a directional player, so someone can correct me...

    Peace.
     
    #25     Aug 30, 2005
  6. i know...what i am doing is more complex than that tho.

    let me do my homework tho.
    let me re think.
    thanx
     
    #26     Aug 30, 2005
  7. Maverick74

    Maverick74

    No palawan, the problem is he does not have a profit at all. He has a worthless position. He can sell the put if he wants but now all he has done is taken a long underlying position. He now has substantial downside risk. He hasn't hedged anything. What he needs to do first is learn his synthetics. Then he should come back and trade.
     
    #27     Aug 30, 2005
  8. i am doing a demo any wayz.

    thank you all for the help however :)
    I will do my homework
     
    #28     Aug 30, 2005
  9. palawan

    palawan

    Ok, cool. i thought he said he was already long (and i assumed profitable position) but that he didn't believe in stop-loss order. i guess there's the flip-side where he's long (and negative on the position) but wanted to protect from a "crash" by using a put.

    i still say close the position (at a loss) and buy a call :) simpler strategy of being protected from a "crash" in the underlying but still able to profit on the upside

    but that's just my directional bias talking there.... :D

    Peace.
     
    #29     Aug 30, 2005
  10. I agree.

    its just that i have a long position that has not made profit yet...
    just got into the position.

    but then i have to hedge.

    You are right, might as well go long on a call.

    does the same thing.

    I knew it, but i need to apply that to my stretgy that i have not mentioned as yet.

    going long / buy put or buy call..

    they are fighting in my head for my strategy
     
    #30     Aug 30, 2005