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hmmmm..... Something doesn't add up here. What am I missing?
Ben wrote:
> at the close of yeasterday and since i never stay naked overnight he
> bought 4 April 1400 calls at 9750 ($39000)
> and sold the 8 May 1300 puts at 5000 each (taking in aprox $40000)
> lets calculate were i am:
> the profit on he short 4 futures is (if we close at 1380) is
> 86*250=$21500
ok, +$21,500 (open profit on the short futures)
> the 4 Apr 1400 calls are @7250 or =$29000
-$10,000 (open loss on the long calls, paid $39,000)
> the 8 May 1300 puts are@xxxx or =$51000
> the may 1275 puts bring in 5000*8=40000
-$11,000 (cash expense to roll to the lower strike on the short puts)
> so net net ahead $10000 minus comm
Looks to me like you are ahead $500 minus comm.
If you had cashed everything out on the close, using your numbers....
4 spoos: sold average 1401.50, bot 1380.00 -> +$21,500
4 Apr 1400 calls: bot 9750, sold 7250 -> -$10,000
8 May 1300 puts: sold 5000, bot 6375 -> -$11,000
Profit before commish -> +$500
If you continue to hold, your long calls will expire a month before your
short puts, increasing your risk. I really must be missing something.
--
Dennis
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