Day Trading E-mini S&P 500 Options on Futures using Weekly Expirations
Strangle example 2:
A customer comes into the day with $10,000 of starting day trading buying power and a short position of 50 XYZ March 40 calls ($2.30). XYZ closed at 38 the previous night. The requirement for this position is $49,000.
Trade 1 (9:15 a.m.): STO 50 XYZ March 35 puts $1.00.
Stock price remains 38.
This trade is paired against the short call position and the exchange requirement to place this trade is the premium of the puts or $5,000. The customer does not need to put up any additional funds as the $5,000 in proceeds are applied to the trade.
Trade 2 (11:45 a.m.): BTC 50 XYZ March 35 puts
The customer has day traded the puts.
The requirement for this trade is $32,500 and a day trade call in the amount of $22,500 will be issued to the customer.