Recently, the whole stock market is uncertain, and the stock price fluctuates greatly, so it is difficult to judge the market trend for a while. A speculator decided to enter the market to buy S&; P500 two-way choice, waiting for the opportunity. June 18, bought 1 copy of September s&; P500 call option and put option in the same period, the exercise price of both call option and put option is 230.00, namely $57,500 (230.00×250), and the option premium is 4.00, namely 1 1,000 $ (4.00×250). To this end, speculators paid a premium of $2,000 for two-way options.
During the validity period of the option (June 18 to August 3 1 day), speculators may encounter the following situations, and the results are different.
1. If the option is valid, the related s&; The price of P500 stock index futures contract remains stable at around 230. O0, or its volatility does not exceed 8. O0, that is, the increase or decrease is not enough to cover the two-way premium of $2,000, so speculators cannot exercise their options, so they will suffer the biggest loss, that is, $2,000 paid on June 18.
2. If the premium of the two-way option purchased by the speculator remains unchanged or the difference between the premium of the call option and the premium of the put option does not exceed 8.00, he can't resell the option, then he will also suffer the biggest loss, that is, 2000 dollars.
3. If the relevant S&; P500 stock index futures contract price is higher than 238. O0 or less than 222. O0, he can sell or buy L shares of S&; P500 futures contract hedges the call option or put option bought before, so that another futures contract automatically expires. For example, by July 20th, S&; When the price of P500 futures contract reaches 240. O0, that is, US$ 60,000 (240.00×250), speculators immediately demanded to exercise call options and buy L S&; P500 futures contract, and in S&; amp; Time is sold in the futures market at the market price of 240.001s&; P500 futures contract, both written off, the previous buyer's put option expires automatically (or play it by ear within the validity period of the remaining options). In this way, the real profit of speculators is 2.00 (240.00-230.00-8.00), that is, 500 dollars. Put options are exercised as above. For example, on August 8, S&; P500 futures contract price is 2 10. O0, or $52,500 (2 10.00×250). Speculators immediately exercise put options and sell L S&; P500 futures contract, at S & time, bought at the market price of 2 10 1S &. o0; P500 futures contract, on the contrary, the previously bought call option will be automatically cancelled when it expires. In this way, the speculators' actual profit is12.00 (230.00-210.00-8.00), that is, 3000 dollars (12.00×250).
4. If the option is valid, S&; If the price of P500 futures contracts fluctuates frequently, we can seize the opportunity to exercise call options when futures prices rise and put options when futures prices fall, as long as the price difference between them exceeds 8.00. For example, on July 8, S&; When the price of P500 futures contract reaches 223.00, speculators immediately exercise put options and sell L S&; P500 futures contract, and buy1s&; According to the market price of 223.00; P500 futures contract, on the contrary, the speculators make a profit of 7.00, that is, 1750 USD. By July 18, s&; When the P500 futures contract price reaches 237.00, speculators exercise call options and buy1s&; P500 futures contract is sold at the market price of 237.00 1 contract at the same time, and the two contracts are offset, and the speculator gains 7.00, that is, 1.750 USD. After deducting the royalties paid before from the profits on July 8th and July18th, the speculators actually made a profit of 6.00 (7.00+7.00-8.00), that is, 1500 USD.
5. Within the validity period of the option, as long as the premium difference between the call option and the put option exceeds 8.00, speculators can speculate and make profits by reselling the option. If August 8 s&; The premium of P500 call option is 2.50, or $625, and the premium of put option is 15.50, or $3,875. Speculators immediately sell two-way options and get a premium income of 18.00, or $4,500. After deducting the previous premium of $2,000, speculators actually earned $2,500.
Although the speculative trading of futures options mostly adopts the way of buying options first, then reselling or exercising options, there is no need to worry about the lack of option sellers in the market. Due to the relationship between supply and demand, the call option price is higher than the put option price, which will inevitably promote the increase of option premium, thus stimulating the increase of option sales; On the other hand, as speculators gradually throw out the options they originally bought, it will also promote the increase of selling options, and the buying and selling of options will always tend to be balanced.