Equity index option investment 02
but ultimately failed.
Expectations are also in line.
A ghost number shows a certain future number, but no other number until that number becomes a reality.
In other words, a so-called ability vacuum phenomenon occurs in which one cannot see another ghost number until it is realized.
On the other hand, the combination of card numbers that each individual has in a Texas Hold’em poker game seems to have a slightly different meaning.
In other words, it seems that each combination of numbers is recognized as an object destiny, so it seems that Hyun-Jun was able to see all the individual card numbers.
Mmm. well, i can’t help it
Unable to do so, Hyun-joon again focused on trading S&P 500 futures.
2731.00 points of the S&P 500 futures index, which will pop out at any time.
Still, it has risen by about +9.75 points from the current point, so you can look at the actual profit first.
So, Hyun-joon started calculating the cost and expected profit needed to buy S&P 500 futures in turn.
but after a while
#
hey, what the hell is this
Expected profits are too salty than expected.
Hyeonjun immediately expressed his disappointment. Based on the purchase of 100 contracts, the actual purchase cost alone would be approximately $68 million. Even if leverage is applied here, approximately $11.34 million is required.
The problem is the expected return.
A +9.75 point increase in the index is expected to generate only $40,000 in profit.
If you factor in the transaction fee, the actual profit will be much smaller.
In the end, after struggling over and over again, Hyeon-jun gave up the order itself.
But at that moment, a better idea immediately comes to mind.
Hyunjoon smiled and patted his chin.
Haha, also…
Yes, is that an option too?
The delicate leaves sway greatly even in the slightest breeze.
It’s like options are like those leaves.
Isn’t it the option market where a big change occurs even with a small change in the futures index?
So, from then on, Hyun-joon began to look closely at options stocks in the S&P 500 index, which had a large trading volume. At this time, I also carefully looked at only the S&P 500 index option stocks, which are slightly larger than the Micro E-mini S&P 500 index stocks.
Currently, the stock is a multiplier contract of $100 per contract, so the option purchase cost is determined by (option premium quote) * (number of contracts) * $100 (multiplier).
After checking like that, Hyeonjun now checked the current time.
Then, taking a deep breath, I looked around.
A neat looking room. Everything is quiet and peaceful.
Hyeon-joon, who enjoyed such a feeling for a while, said after a while.
Finally, I placed an order for the $2,725 call option, starting with the $2,700 strike price.
#
Tring!
“The purchase contract has been concluded.”
Tring!
“The purchase contract has been concluded.”
Tring!
“The purchase contract has been concluded.”
Buying contract alarms are heard without a break.
A lot of quotes were on the market, so contracts were going on very quickly.
Hyunjoon was satisfied.
However, we continued to buy, noting that if one issue ran out of stock, the option price would immediately rise.
and after a while
A call option with a strike price of $2,700 has an average premium of $30.55.
A call option with a strike price of $2,705 is $25.82.
A call option with a strike price of $2,710 is $20.78;
A call option with a strike price of $2,715 is $14.78.
A call option with a strike price of $2,720 is $10.32;
Calls with a strike price of $2,725 were purchased at $5.02 each.
As a result, a total of 4,787 contracts were signed.
At this time, the amount of money invested reached 8.5 million dollars.
However, it is true that the current option premiums are set too high, so more funds were invested than expected.
As the so-called current market itself is expected to rise, the option premium is reflected much higher.
Anyway, after Hyun-joon finished buying the call option, he got a rough estimate of the expected profit through simple calculations.
#
Wow, this is definitely an option no matter where you go.
A completely different figure from investing in futures.
Estimated revenue, based on the ghost numbers, is a whopping $4 million.
Minimum projected revenue only $4 million.
This figure is not comparable to the expected returns of investing in futures.
As such, options are sensitive to minute fluctuations in real assets.
After all, it wouldn’t be an exaggeration to say that options are the best gamble.
On the other hand, Hyun-joon wanted to buy up to the maximum amount of cash, but eventually refrained.
This is because, as his intensive buying continued, the asking price of each option premium also continued to rise.
#
and the next morning.
Hyeon-jun ate breakfast with a free breakfast coupon from Best Western Plus Ruby’s Inn.
As soon as I finished checking out, I headed to Arches National Park early in the morning.
“Hey, Have a Nice Day!”
Meanwhile, a Latina female employee of Inn met by chance in the parking lot greeted Hyeon-jun lightly.
Hyeon-jun also smiled and replied, and immediately started the engine.
So now to Arches!
The nearby Zion Canyon (zion canyon national park) is something I plan to stop by on my way back to Las Vegas… So, after driving eastward along I-70E for about four hours, Hyeon-joon finally arrived at Archers National Park, which has amazing views.
In fact, this Archers National Park is famous for its very beautiful scenery that only those in the know among Koreans know.
A beautiful garden created by the gods.
It looks like there are rocky mountains all over the place.
After a while, Hyeon-jun came to the Devils Garden Trail head parking lot.
After all, where there is a play of the gods, is there always a play of the devil? The title Devil’s Garden itself was interesting to Hyeon-jun.
Meanwhile, after Hyun-jun got out of the vehicle, he started tracking along the Devil’s Garden trail course.
and after a while
An astonishing scenery spread out before your eyes.
Hyeonjun’s eyes were getting bigger and bigger.
Wow, that’s great too.
The beauty of Tunnel Arch is the first thing that catches your eye.
An oval hole in the middle of a huge rock. And the clear sky of winter in February, seen through the hole, feels something different.
From there, Hyunjun went through Pine Tree Arch and Landscape Arch.
Soon after, the Partition Arch with its bizarre arrangement of rocks enchanting, the cozy Navajo Arch as if from another world, and the Double O Arch with a large circular hole in the center of a huge rock and a small hole under it strangely harmonize. Double-O-Arch), etc.
The indescribable charm of Mother Nature.
Hyeon-jun felt his heart open wide, and he fell deeply into its beauty.
After visiting Archers, Hyeon-joon passed through canyonlands national park and stopped by Capitol Reef National Park.
Later, as the sun went down, we arrived at Torrey, a small town located in Wayne County, Utah, USA, and stayed overnight at an inn there. There is no such thing as a 5-star hotel in this place.
Anyway, the next morning.
Hyun-Jun ran for about 3 hours again, arrived at Zion Canyon National Park, and enjoyed trekking while looking at Mother Nature for a long time.
Then, after driving along the I-15S road for 2 hours and 30 minutes, Hyun-jun finally returned to the Bellagio Hotel.
By the time it was almost 7pm.
As soon as Hyun-jun returned to his room after returning the rental car, he hurriedly prepared various things and finally looked at the current status of option trading.
#
How could it be? Wow, that’s exciting.
First of all, today’s S&P 500 real index is 2737.70 points.
The S&P 500 futures index is 2731.00 points.
In particular, this futures index was the same figure Hyun-joon read in the form of a ghost number yesterday.
However, even with this, it can be seen that although it is the same index item, there is a slight difference in numerical value depending on whether it is real or futures. At this point, there is a difference of about 6.7 points.
However, what is important to Hyun-jun now is that each strike changes the option premium price. Fortunately, during the day, call option prices continued to rise steadily.
If so, should I place a sell order now? Or should we wait for the uptrend while holding a little more?
The good thing is that there is almost no change in the current S&P 500 futures index.
In any case, it is a stable phase.
So let’s check the future index next time.
Now is the time to use your own abilities.
From then on, Hyun-jun began to pay more attention and focus on the real index.
and after a while
At this time, unexpectedly, Hyun-joon’s eyebrows are narrowing strangely.
#
[2,731.61]
what? 2731.61?
Hyeonjun looks at him with a frown and scratching his head. Surprisingly, it came out that the future figures were not good.
Hyeon-jun looked at the numbers scrawled on the hotel room memo and fell into deep thought.
This figure is down 6.09 points from the current index.
The saying that tomorrow will record negative index points.
In fact, it is a slight decline, equivalent to about 6 points, but the option price tomorrow may plummet by tens of percent during the day.
In the end, Hyun-joon made a decision.
Rather than floundering in the market of tomorrow’s option crash, he decided to hurry up and relieve his stocks.
#
Tring!
“A sell order has been executed”
Tring!
“A sell order has been executed”
Sell order execution alerts are heard non-stop.
Likewise, when Hyeon-Jun released large quantities in the market, the asking price, which had been on a slight upward trend, began to fluctuate rapidly from then on.
The atmosphere is as if cold showers were poured over firewood that was quietly burning.
Even so, Hyun-joon never stopped.
Even if the index drops by just a few points, derivative financial products, by their nature, are bound to fluctuate greatly.
In particular, these options themselves are in a state of great fluctuation, so if you stay still, option assets can converge to 0 in an instant, so Hyun-jun reacts immediately and sells immediately, just like the program buying and selling method.
However, this itself would be an adventure for investors who do not know the future quote, but Hyeon-joon was different anyway.
So, Hyun-joon put a sell order for contract options by strike price, persistently unfolding a strategy to notice in order to continuously relieve his stock.
After quite a while, most of the stock was disposed of in the market. In other words, most of his long call option positions were liquidated.
#
Tring!
“A sell order has been executed”
And Hyun-jun, who left the last 300 contracts to sell.
The hand holding the mouse felt slightly sweaty, but Hyun-jun watched the change in the asking price, and for a moment, he placed a sell order for these last stocks at once. I had no choice but to throw in the quantity at a lower asking price, and thanks to that, I was able to complete the position liquidation process in an instant.
Tring!
“A sell order has been executed”
And just like that, the last alarm sounded…
under! finally sold them all
As he tried to sell it at a moderate asking price, the strategy continued towards the second half, but Hyun-joon was relieved nonetheless.
By the way, what time is it?
Hyeonjun immediately checked the time. It’s almost 12 o’clock at night. It’s been quite some time since I started selling options.
Looking at it, my eyes dimmed and all sorts of fatigue came pouring in.
Still, now is the time to check the harvest.
Hyun-joon was finally able to check the profit situation.
#
and! plus $384,255.
So a profit of $380,000?
This isn’t as bad as you think.
It was only a one-day option investment, but the option profit of about $ 380,000 was caught before I knew it.
Only a small exponential increase.
Nevertheless, after buying and selling at the correct timing, Hyun-joon again made a profit.
As a result, Hyun-joon’s overseas account balance has now risen to $21.38 million.
#
and the next day.
Early morning on Thursday, February 7, 2019.
Hyun-jun ate breakfast at the Bellagio Hotel buffet and hurriedly headed to the airport.
The trip to Las Vegas is now over, and it is to fly to San Francisco, the next destination.
In fact, one of the purposes of this trip is to have a working-level meeting at the NovaCEM San Francisco laboratory, which is now to be digested. Of course, it was entirely to help Professor Bae Ki-gi’s company, ‘New Drug NS Science’, transfer the technology.
and after a while
Hyun-joon took the morning flight and finally flew to San Francisco.
