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  #1  
Old 03-20-2002, 04:31 PM
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Default Bond option trade



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.


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Old 03-20-2002, 04:32 PM
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Default glad you\'re back [img]/images/smile.gif[/img] *NM*




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Old 03-20-2002, 04:37 PM
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Default Re: glad you\'re back [img]/images/smile.gif[/img]



Thanks,any thought regarding the option trade?
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Old 03-20-2002, 04:45 PM
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Default I like it, I guess...



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.


eLROY
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Old 03-20-2002, 05:17 PM
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Default Re: I like it, I guess...



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.
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