Wednesday, April 14, 2010

Oil is Too High, But Profit If It Goes Up or Down

Oil has risen significantly in recent days and weeks. The high prices will likely choke any economic growth.

We track all oil ETFs live here.

Below are straddles to profit regardless of whether oil goes up or down. We show USO for April and May, and our favourite UCO for May. With 3 days to expiration, UCO is too risky for April.

Note: The top table is for April, the bottom tables are for May.

Computed with StraddlesCalc Tool, which indicates the maximum move required for the position to become profitable. So for April, a 2.01% move in USO makes it profitable.

Please do your own due diligence. This is not advice. Options are very dangerous and may cause 100% loss.

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