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CFTC regulation 4.41 requires the following disclaimer:
HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT , THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCES RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELEY AFFECT ACTUAL TRADING RESULTS.
Ask about the Weekly Option's Report for more information or watch our video.
Term Structure
Notes:
Contract Size - $125,000 Euros
Tick Size: 0.0001=$12.50 for premium
Trading Hours:
Sunday - Friday 6:00 p.m. - 5:00 p.m. (5:00 p.m. - 4:00 p.m. Chicago Time/CT) with a 60-minute break each day beginning at 5:00 p.m. (4:00 p.m. CT).
* Tip: Understanding what the numbers mean when looking at EuroFX prices. The quotation you see is in U.S. dollars and cents on the index. The multiplier is 125,000 Euros. So, a quote of 1.1350 on the index is the standard quotation. Each contract you are buying or selling is where you take the price times 125000 (125000 x $1.1350 = $141,875 for contract). So, a 1 tick move is $0.0001 x 125000 = $12.50 USD per tick up or down on the futures.
?ml=1" class="modal_link" data-modal-class-name="no_title">* Tip: Click here to read a helpful tip about EuroFX futures and options
EUROFX
Below are weekly & daily charts for reference.
* Tip: To view a larger chart image, simply right click on the image with your mouse. Next, select view image. Be sure to click the back arrow on your browser to go back to the original page.
?ml=1" class="modal_link" data-modal-class-name="no_title">* Tip: Click here on enlarging images
Strategies
Below is the starting position for a vertical swap spread. This is a conservative structure with positive Vega that would benefit if volatility ran higher.
The position underneath represents the suggestion in our weekly options report with a reverse calendar call spread. This has negative Vega which benefits as implied volatility reverts to historic levels lowers.
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.
Calendar Spread
Below is a simple calendar spread with bullish bias to the upside over the next week.
Iron Condor - bullish
If the Euro continued trending higher. Difference is where this structure has negative Vega which has an edge should implied volatility decline as opposed to above.
Vertical Swap (bearish)
Below is a directional trade to the downside if one's bias is that the Euro would suddenly reverse over the next week.
