Get your copy of Paul Forchione's book, "Trading Iron Condors". Learn techniques from a professional options trader to manage risk while speculating on futures markets.
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.
Below are weekly & daily charts for reference.
Strategies illustrate both views into summer months, whether a continued fall in price with slight retracement to the upside or a potential reversal.
Below are 2 separate strategies. First is a calendar put for a further push bearish. Second is a broken wing iron condor based on implied volatility being slightly higher than historic levels at time of this post.
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.