Long-term American Options in Crude Oil

did a little QM scalping and now legged in into a position:

1 QM JAN @ 50.675
1 CL JAN 50 put @ 3.80

it supposed to be a synthetic straddle.
I plan to adjust it with USO ETF.
Or if there will be a big spike in QM I'll sell it, if it will finance my put.

Any option Guru here? Can you advise me, how to adjust this position to be delta-neutral? I my SW os sucks, can't calculate greeks...

Also, what's the risks (except the case when CL will stay around these levels till expiration).

Thanks in Advance!
HLB

 

You need to buy 2 puts and 1 underlying for the synth straddle. You have a synthetic call.

 

oh, I screwed now - oil will tank to $30 and I'll lose big! - NOT
Maybe you understand in options, but not in oil futures.
FYI:

1 CL = 2 QM

another difference is that CL is physically-settled and QM cash-settled.

HLB

 

My mistake, you're right.

 

NYMEX

By the way, you don't want to buy options, right?
Time decay will kill you.
Best to sell options, or, if you don't want unlimited risk, oil ETFs.

 

CL long-term options doesnt seem to have any open interest. no one makes the market and I can only find an occasional 1c bid from somebody trying to pick off a market order I guess, does anyone know how to buy long term crude calls?

 

Have your broker phone the pit, they'll make a market for you - it will be wide but not unreasonable.

 

I'm with IB, have you used them for this?

 

PM me if you need a mrkt indication.

 

If you are interested in apo (asian) cl options and are setup for clearport or can do an eoo (ask your fcm) then shoot me a message.