Lecture 9

Lecture 9 - Lecture 9 VIX Option Strategies Buying a VIX...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Lecture 9 VIX Option Strategies
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Buying a VIX Put Example: VIX Index is at 32.12 Outlook: You are bearish on the VIX Index and expect it to fall over the next six weeks. Possible strategy: Buy 1 VIX January 30 strike put @ $3.70 Potential Profit Outcome Examples: VIX Index in January Long 30 VIX Put Cost Net Profit 34.00 29.00 26.30 25.00 In Summary : Consider purchasing a VIX put if you anticipate a fall in the VIX. Risk is limited to the total premium paid.
Background image of page 2
Example: VIX Index 32.12 Outlook: You are bullish on the VIX Index and expect it to rise over the next six weeks. Possible strategy: Buy 1 VIX January 35 strike call @ $2.65 Potential Profit Outcome Examples: VIX Index in January Long 35 VIX Call Cost Net Profit 39.00 37.65 33.00 Summary : Consider purchasing a VIX call if you anticipate a rise in the VIX. Risk is limited to the total premium paid. Profit potential is theoretically unlimited.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 7

Lecture 9 - Lecture 9 VIX Option Strategies Buying a VIX...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online