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Hello all:
A basic question here, for testing purposes. I'm trying to figure out the
cost of a option spread. Due to the contraction of the CRB (basis CRM9) I
think an at the money call-put spread might be rewarding. But I'm having
trouble calculating the cost of this spread.
According to the Quote-Watch option chain, the following CR options cost:
bid ask
Call 192 F99 2.85 2.85
Put 192 F99 2.35 2.35
Now if I multiply the 2.85 by the value of a CR tick (ie. $25) the cost is
71.25. And the Put is 58.75. This spread would only cost $130 (plus comm.).
That's a bit too good to be true.
What am I doing wrong?
Thanks,
Joe
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