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Re: [RT] Fair Value



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Dom-
 
If you find out; please let me be among the first to know.  I've agonized about this for a long time.  The problem is
knowing wheter to either fade the trend; or go with the trend; at those times when program buying/selling enters the market.
 
Chas
----- Original Message -----
From: dom1_1998
Sent: Wednesday, June 08, 2005 1:38 PM
Subject: [RT] Fair Value

I'm trading the S&P e-minis for the first time.  I'm trying to
understand the strategies for trading the premium differences.  I'm
using Esignal and the symbol for difference between the emini and spx
is $EPREM.

The FV today is +$0.45.  The instructions on www.indexarb.com says if
the premium difference reaches +$1.67 they suggest buying the futures
due to program buying is initiated, and vice versa if it's -0.54.

My question is, if the futures are over-valued, why would you buy them?

TIA,

dom





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