View Full Version : Bond option trade

03-20-2002, 04:31 PM
I almost got these done today,missed by a tick.

June bond options.

Buy 5 94/95 put spreads and sell 1 96 put for 2

credit.This is a must do trade.

03-20-2002, 04:32 PM

03-20-2002, 04:37 PM
Thanks,any thought regarding the option trade?

03-20-2002, 04:45 PM
I'm bullish on the CBOE Vix here so, by deduction, I'm bearish on stocks.

And I'm also bullish on oil.

So, in some weird way, although I am bearish on bonds, I don't expect them to just go into freefall, but rather to be choppy with a ceiling.

My thoughts are

1) your play seems a little convoluted - not unlike your reaction to my CPN contraption,

2) I like it in general just because the credit, though 96 seems a little close going out to June, but I assume it has plenty of premium, and

3) I think the 94/95 spread is just right, given the time left and the current price.

I think we'll see 96, maybe a little lower, and a lot of chop.


03-20-2002, 05:17 PM
You do understand I would be long 5 95/94 put spreads for each short 96 put? I tried to do these

packages for 2 tick credit and could have done them flat..I might have done them flat if I was on the floor but too much slippage from home.

On an expiration basis I lose below 91,homerun is

at 94.I don't think we will free fall either.

Also if there is an "event" it is possible the bonds could stabilze or take off.