Let’s look at specific examples of options trading through the QUICK app.
Example #1. Implementation of the strategy for options on the RTS index as of the current date 16.06.22. In the QUICK trading terminal, we will open the chart for the June futures of the RTS index (see Fig. 183), i.e. the current one, we will also open the September futures for the RTS index (Fig.184) and December (Fig.185) in order to assess the expectations of players for the perspective of the half-year.
Fig.183. June futures on the RTS index (RIM2).
Fig.184. September futures on the RTS index (RIU2).
Figure 185. December futures on the RTS index (RIZ2). It can be seen from the charts that the expectations of the players suggest a transition from an upward trend of price movement to a flat within six months. The current trend is growing. The situation for six months on the RTS index is uncertain against the background of sanctions. It turns out that for a short period of time we are focusing on the growth of the index, up to the payment of dividends on large stocks in July (Gazprom, etc.), then there will be a dip in the price down and flat. Further failure in the long term is also possible. That is, first of all, bidirectional strategies with a six-month perspective are interesting. The current options board for September options is shown in Fig. 186-190.
Fig.186. September options board for options up to 06/23/12.
Fig. 187. September options board for options up to 30.06.22.
Fig.188. September options board for options up to 21.07.22.
Fig.189. September options board for options up to 08/18/12.
Fig.190. September options board for options up to 09/15/12.
In table 1, we will analyze the application of the strategies discussed above for this situation.
Table 1. Analysis of the application of strategies.
|Strategy||Analysis of the strategy application|
|Long call||Only for a short period (one to two weeks before the dividend period). CALL options with maturities of 23.06 and 30.06 will be suitable.|
|Short call||It’s too early, there are no signs of a falling trend|
|Long put||It’s too early, there are no signs of a falling trend|
|Short put||Possible, but too risky option. You can try on options up to 30.06.22|
|Bullish Call spread||Possible up to dividend cut-offs on shares.|
|Bullish Put spread||Possible up to dividend cut-offs on shares.|
|Bearish Call Spread||Пока рано, нет признаков падения тренда|
|Медвежий пут спрэд||It’s too early, there are no signs of a falling trend|
|Proportional Call spread||It is advisable for the long term|
|Prop. Put spread||Possible for options with maturities of 23.06 and 30.06.|
|Prop. Reverse Call Spread||Given the higher probability of falling is impractical|
|Purchased straddle||It is interesting for a long period up to six months.|
|Sold straddle||You can try on options up to 30.06.22|
|The purchased strangle||It is interesting for a long period up to six months.|
|Sold strangle||You can try on options up to the payment of dividends|
|Strap||It is interesting if you still expect the growth of the RTS index for a long period|
|Strip||Very interesting for a period of up to six months|
|Purchased butterfly (call)||You can try on options up to the payment of dividends|
|Sold Butterfly (call)||The strategy is interesting for a long period of up to six months|
|The purchased condor||You can try on options up to the payment of dividends|
|Sold Condor||The strategy is interesting for a long period of up to six months|
|Range Forward||The strategy is interesting for a long period of up to six months in anticipation of a fall in the price of the underlying asset|
|Calendar spread||The strategy is interesting for up to 2 months|
|Diagonal spread||The strategy is interesting for waiting for the price of the underlying asset to fall with a short-term price increase|
|Bullish Call Ladder||The strategy is questionable for the current situation on the RTS index|
|Gats||The strategy is interesting for a long period of up to six months, similar to straddle and strangle|
|Roll with jam||The strategy is interesting for up to 1 month|
Taking into account the forecast, a good strategy would be to simply buy a PUT option at a price of 5660 rubles (this is our minus if the price goes above 114,000, Fig.191). If the price of the underlying asset falls below 114,000 by 21.07.22, we will make a profit.
Fig. 191. Analysis of the strategy for buying a put with a strike of 140,000.
Fig.192. Correction of the strategy by selling putts.
However, I would like to avoid a loss altogether if the price goes up by 21.07.22. Let’s see what we can do.
1) Figure 192 shows the strategy of selling 3 puts on strike 135 000, which practically covers any losses of our strategy of buying a put according to Figure 191. You can adjust the amount of the desired profit by the number of sold pets, but you should carefully calculate the cost of SUITABLE ones.
2) In order to exclude any losses, it is also possible to buy futures on the RTS index when the market is not in your hands, i.e. to hedge. Futures need to be bought at a price when the put option profit chart crosses zero profit (see Figure 191), i.e. 120000 – 122500. It should also be taken into account that futures gives a commensurate profit compared to an option when the delta of the option is equal to 1.
Example #2. Option on Gazprom JSC shares.
To begin with, we will add the desired futures to the Current trading table of the QUIK terminal. Click the right button inside the Current Trades window and select FORTS in the available instruments: futures GZU2 (September futures for Gazprom JSC shares). Click Yes, double-click the left mouse button on the line that appears. A glass of this futures will appear. Right-click inside the glass to select Build a graph. Let’s set the chart type to Daily (see Fig.193). The cost of 1 futures is 25970 rubles, the price for the purchase of 1 futures is 9170 rubles.
In the options board, select the desired type of options GAZR-9.22. We see that the liquidity of options is very low (Fig. 194-198). Nevertheless, let’s try to figure out how you can use this tool to earn money. According to the schedule of the underlying asset, i.e. Gazprom JSC shares, a long flat is planned. In such a situation, the preferred option may be the construction of a purchased condor, the purchase of a butterfly, the sale of a strand or a straddle. Consider buying a condor (Fig.199).
Fig. 193. GZU2 futures price chart of Gazprom JSC.
Fig.194. GAZR-9.22 option with maturity date 29.06.22
Fig.195. GAZR-9.22 option with maturity date 06.07.22
Fig.196. GAZR-9.22 option with maturity date 20.07.22
Fig.197. GAZR-9.22 option with maturity date 17.08.22
Fig.198. GAZR-9.22 option with maturity date 14.09.22.
Fig.199. The construction of the purchased condor on options for shares of Gazprom JSC.
As you can see in Fig.199, an extremely interesting strategy turns out, allowing you to earn in a fairly wide range of changes in the price of the underlying asset.
If the price enters the zero profit zone on the left, we can sell futures or the underlying asset (Gazprom JSC shares), if to the right, we will need to buy futures or shares.