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VolatilityOptions fall into the category of being slightly undervalued in non-volatile markets in the weekly options report.
Contract Size - 40,000 lbs (~ 18 MT)
Tick Size: $.00025 per pound (=$10 per contract)
Trading Hours: CME Globex: Sunday - Friday 6:00 p.m. - 5:00 p.m. Eastern Time (ET) with trading halt 4:15 p.m. - 4:30 p.m.
Strategies illustrate both views into summer months, whether a continued fall in price with slight retracement to the upside or a potential reversal.
Below is the starting position for bullish calendar spread and beneath is a bearish diagonal version for an opposite view. Both illustrate a directional play with positive Theta.
The % yield shown in the diagrams below represent an estimated return on margin from projected dates shown below. The structure has positive time decay which is an advantage over holding outright options.