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Alexander
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 Posted:
Thu Oct 20, 2005 12:02 am Post subject:
Question on options on T-Note futures.. |
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Can somebody give me some info on CBOT t-note futures, namely...
Are they European or American style exercise?
If they are American style, does it then imply that put/call parity is
not applicable until LTD?
many many many many (you get the idea) to anybody who can answer this
question I have been trying for months to get an answer for.
Alex N
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Guest
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| Posted:
Thu Oct 20, 2005 12:02 am Post subject:
Re: Question on options on T-Note futures.. |
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Alexander wrote:
| Quote: | Can somebody give me some info on CBOT t-note futures, namely...
Are they European or American style exercise?
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In general, options on futures in the U.S. are American exercise, which
is confirmed in the case of CBOT t-note futures at
http://www.cbot.com/cbot/pub/cont_detail/1,3206,1520+14438,00.html :
"Exercise
The buyer of a futures option may exercise the option on any business
day prior to expiration by giving notice to the Board of Trade clearing
service provider by 6:00 pm, Central Time. Options that expire
in-the-money are automatically exercised into a position, unless
specific instructions are given to the Board of Trade clearing service
provider." |
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Alexander
Guest
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| Posted:
Thu Oct 20, 2005 12:02 am Post subject:
Re: Question on options on T-Note futures.. |
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Beliav,
Thanks so much for your quick and informative reply. If CBOT T-Note
options are American style, does that imply that there is no put/call
parity relationship until expiration?
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Jack
Guest
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Thu Oct 20, 2005 12:02 am Post subject:
Re: Question on options on T-Note futures.. |
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Probably, because put/call parity describes only European options.
Regards, Jack.
"Alexander" <thinkingtheunthinkable@yahoo.com> wrote in message
news:1129750211.584596.50100@f14g2000cwb.googlegroups.com...
| Quote: | Beliav,
Thanks so much for your quick and informative reply. If CBOT T-Note
options are American style, does that imply that there is no put/call
parity relationship until expiration?
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Bondtrader
Guest
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Thu Oct 20, 2005 4:01 pm Post subject:
Re: Question on options on T-Note futures.. |
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There is still going to be some put call parity. Otherwise there would be an
arbitrage opportunity. It is very uncommon for someone to excercise an
option early.. it only happens once in a while in a situation where you are
long a deep in the money option .. If you are long a deep in the money call
and the put is worthless .. then it may make sense to excercise. But if the
put is worth anything you would sell the put and now lock in the reversal
(conversion).
"Jack" <jzaner@adelphia.net> wrote in message
news:VbadnQHpsJ3xLsvenZ2dnUVZ_tGdnZ2d@adelphia.com...
| Quote: | Probably, because put/call parity describes only European options.
Regards, Jack.
"Alexander" <thinkingtheunthinkable@yahoo.com> wrote in message
news:1129750211.584596.50100@f14g2000cwb.googlegroups.com...
Beliav,
Thanks so much for your quick and informative reply. If CBOT T-Note
options are American style, does that imply that there is no put/call
parity relationship until expiration?
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