Options on Futures
Futures can play an important role in an Options investment context, because they can be great hedging instruments to an existing portfolio. This course introduces a new type of instrument – Options on Futures. An Option on a Future means that the underlying asset is the Future itself. This is bound to sound complicated, but its explained in detail. In general, unless you're a Futures trader, you would not trade these instruments. However, what both these products offer is a 24-hour trading window. Therefore, if you had a normal portfolio comprised of Stocks and Options, and were concerned of some crisis brewing in overnight markets, its possible to hedge your portfolio in the middle of the night. This course shows how to do this using both these instruments.
How Options on Futures are different from Options
Options on Futures as a Hedging technique
Can protect moves when markets are closed
Size differences of ES Futures and SPX Options
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