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With the price of Brent having failed between $77.50 and $78.50 three consecutive times in the past month, we will go short at $76.70 with a downside target at $72.00 and a stop-loss at $78.55 on a daily chart closing basis. Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Wednesday 07 June 2023
Charting the Markets: 07 June Indices grind higher. EUR/USD, GBP/USD and USD/CAD struggle to make headway. And WTI and gold trade in low volatility while wheat slips back. Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Wednesday 07 June 2023 This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.
I want to ensure that I totally understand the CFD / Spread bet way of options rather than the traditional way.
What I want to know is that if you are trading NDX daily and you pay for a call option strike price of 16270 which commands a premium of 137.
If NDX gets to 16420, then you can exercise you right, so the profit would be 16420-16270 = 150. If you have 1 contract this would be 100 "shares" = 15000, and then subtract your premium =14863 USD profit.
Why does this not show up on the account, I tried this in a demo and the figures are much less.
1) Options pricing is more complex than the example I have given, there are the Greeks which come into play. Why does IG not show how things are calculated
2) Only after you have bought / sold the option, does the option chart come up. Why cant you see this before? Again why is there no calculation to show you how the figures are derived
3) Taking the other side of the bet, selling PUTS that are far out of the money, why does it show as a negative as soon as you sell it. If it OTM you collect the premium and hope it expires worthless. eg on the demo account I sold a 16242 PUT daily NDX exp today. The current price is 16400. Well out of the money, why does it show as a negative balance.
Also again the chart has values on the Y axis that range from 0 to 30. Why am I not seeing this on the options chain ladder? How are these figures derived and calculated.
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