Below is an illustration trading futures options on Crude Oil. Our post shows bullish and bearish positions using a combination of call and put options.
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Trade Options on Futures
Crude Oil * Directional & Neutral Positions
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Crude Oil
Term Structure
Volatility
Notes:
Contract Size - 1,000 barrels.
Tick Size: Outright: dollars and cents with 0.01 points=$10
Trading Hours: CME Globex: Sunday - Friday 6:00 p.m. - 5:00 p.m. Eastern Time (CST).
* Tip: Click here to read a helpful tip about Crude Oil futures and options
Charts
* Tip: Understanding what the numbers mean when looking at Crude Oil prices. The quotation you see is U.S. dollars and cents per barrel (42 gallons). Each contract you are buying or selling is 1,000 barrels. A 1 tick move is $10 USD calculated as $0.01 x 1,000 barrels.
Latest, Biggest, Busiest
Below is a snapshot with what's going on in the world of options with the most actively traded spreads.
Enlarge by right clicking mouse over each image and select 'open in a new tab'
Below is a May CL 64/65 Bull Call Spread shown in the middle column above.
* Tip: Click here on enlarging images
Option Strategies
* Tip: To view a larger chart image, simply right click on the image with your mouse. Next, select Open Image in New Tab.
Below is a quick glimpse on particular spreads that stand out in the markets. You can see this from the number of bid - offer activity and open interest as we explain in our podcast.
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.
Reverse Calendar
The alternate position illustrated below is a reverse calendar spread. Position has positive time decay (Theta) and would earn if implied volatility were to drop as shown on the weekly options report.
Strategy Target Range
Vertical Swap
Below is a variation if the market were to move directionally higher. Position has positive time decay with negligible impact due to changes in implied volatility.
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