box strategy

rh6996

Well-Known Member
#2
sir . please tell me about the box trading.
Best is Google it. Below is a copy paste from Wikipaedia...

In options trading, a box spread is a combination of positions that has a certain (i.e. riskless) payoff, considered to be simply "delta neutral interest rate position". For example, a bull spread constructed from calls (e.g. long a 50 call, short a 60 call) combined with a bear spread constructed from puts (e.g. long a 60 put, short a 50 put), has a constant payoff of the difference in exercise prices (e.g. 10). Under the no-arbitrage assumption the net premium paid out to acquire this position should be equal to the present value of the payoff.

They are often called "alligator spreads" because the commissions eat up all your profit due to the large number of trades required for most box spreads.

The box-spread usually combines two pairs of options; and its name derives from the fact that the prices for these options form a rectangular box in two columns of a quotation.

Note that box spreads also form a strategy in futures trading
 

DanPickUp

Well-Known Member
#4
sir tell me about the greeks and volatility effect on the box strategy/..
What do you know about the greeks and volatility ?

And by the way : What is your idea to trade a box ?

How would you implement the strategy in the market and why the way you will explain it ?

DanPickUp
 

DanPickUp

Well-Known Member
#5
Best is Google it. Below is a copy paste from Wikipaedia...

In options trading, a box spread is a combination of positions that has a certain (i.e. riskless) payoff, considered to be simply "delta neutral interest rate position". For example, a bull spread constructed from calls (e.g. long a 50 call, short a 60 call) combined with a bear spread constructed from puts (e.g. long a 60 put, short a 50 put), has a constant payoff of the difference in exercise prices (e.g. 10). Under the no-arbitrage assumption the net premium paid out to acquire this position should be equal to the present value of the payoff.

They are often called "alligator spreads" because the commissions eat up all your profit due to the large number of trades required for most box spreads.

The box-spread usually combines two pairs of options; and its name derives from the fact that the prices for these options form a rectangular box in two columns of a quotation.

Note that box spreads also form a strategy in futures trading
My friend

Wikipaedia is the worst source when it comes to real option trading. Try once : Synthetic call back spread :D:D:D:lol:

No no, not Call back spread ! I told you : Synthetic call back spread. :D:lol:

DanPickUp
 
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