I want to establish a long position in the spread of LQD / IEF, on a 10x13 ratio, meaning long 1000 LQD for each 1300 IEF that I'm short. Because these etf's are high in dollar value and low in volatility, it would require a considerable amount of capital to put on a trade of say 3000 x 3900. I am wondering if the trade would play out the same if I did it using options. From my cursory understanding of synthetics, I would want to be long a call, short a put of LQD with the same strike and expiration and take the opposite in IEF (short call/long put). My question is how do I determine what is the best strike to use? It is a trade I would want to have on for a month or two, so I have been looking at september expiry. LQD pays a monthly dividend of .43 and IEF pays .27 monthly. I want to play the directional movement of the spread, not the stocks themselves. Any feedback would be much appreciated.