I'm a complete dilettante in options, but a thought came to my mind. А что если застраховаться от неминуемо надвигающейся в ближайшие дни жестокой коррекции рынков the road опционами с минимальными затратами.
For example, buy cheap November SPY put options with a strike 113 — I suppose that the correction will be at least up to this level. They are only worth something 0,09.
For example, if we buy 10 put options with strike 113 on 0,09 — we will pay 90 Dollars.
If the SPY price falls to this level in the next few days, then the strike price will become approximately the same as the strike is now 122 — about 1,20 — and since volatility will increase, it may be even more — i.e, if we fix a position at this level by 1,20, then we get 1200 Dollars.
Total 1200 – 90 = 1110 dollars of profit
Accordingly for 100 options will 12000 – 900 = 11100 dollars of profit
For 1000 options 120000 – 9000 = 111000 dollars of profit
И т.д.
That is, the costs for insurance are very small., and the potential profit is more 1000% in just a few days. And the likelihood of a strong correction in the next few days is very high., in my opinion. Even if there is no correction, to insure with such a small amount is not a sin at all.
But since I'm a big dilettante in options, then there are probably still errors in my calculations, so think for yourself and double-check a hundred times :)
