Selling puts on FCOJ at 50 strike

Discussion in 'Options' started by short&naked, Jun 9, 2009.

  1. OJ has been ranging for decades. If the strike price is ever hit, one could always own OJ futures at 50 USD. Anybody doing this?
  2. what month / yr, how many, and what price?
  3. It's not worth it for many reasons, the most important of which is that those options have no "juice" in them. :cool:
  4. LOl. Liquidity?

    What are the other reasons?
  5. no he meant there is no premo in them...although yes...liquidity a concern too. Usually in OJ options, if you think its a level that can't possibly be hit and you find someone to buy your writes at that'll find you
  6. 1) Right now, you'd be lucky to get more than two ticks to short-sell those puts. It's not worth it.
    2) The bid-ask spread gets "wider" with illiquid options.
    3) In a faster moving market, the few locals there are will "hesitate" before letting you in or out of a position. That would be less likely to happen in a liquid market.
    4) I believe there is no electronic access in that market. You would be captive to the pit-session.
    5) With physical commodities, speculators prefer to trade from the long-side by buying calls and hoping for the market to go up to the moon.