Add training workflow, datasets, and runbook

training_data/relevant/text/cf069ba089810b5e8e5160a90f7eb49357b37e8818a4eaf2c2df1cc34526c427.txt

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+714 Part V: Index Options and Futures 
+calls more profitable than the loss in his puts. This is the advantage of using in-the­
+money options instead of futures in futures spreading strategies. 
+In fairness, it should be pointed out that if the futures prices had remained rel­
+atively unchanged, the 0.12 points of time value premium ($300) could have been 
+lost, while the futures spread may have been relatively unchanged. However, this 
+does not alter the reasoning behind wanting to use this option strategy. 
+Another consideration that might come into play is the margin required. Recall 
+that the initial margin for implementing the TED spread was $400. However, if one 
+uses the option strategy, he must pay for the options in full - $1,800 in the above 
+example. This could conceivably be a deterrent to using the option strategy. Of 
+course, if by investing $1,800, one can make money instead of losing money with the 
+smaller investment, then the initial margin requirement is irrelevant. Therefore, the 
+profit potential must be considered the more important factor. 
+FOLLOW-UP CONSIDERATIONS 
+When one uses long option combinations to implement a futures spread strategy, he 
+may find that his position changes from a spread to more of an outright position. This 
+would occur if the markets were volatile and one option became deeply in-the­
+money, while the other one was nearly worthless. The TED spread example above 
+showed how this could occur as the call wound up being worth 1.00, while the put 
+was virtually worthless. 
+As one side of the option spread goes out-of-the-money, the spread nature 
+begins to disappear and a more outright position takes its place. One can use the 
+deltas of the options in order to calculate just how much exposure he has at any one 
+time. The following examples go through a series of analyses and trades that a strate­
+gist might have to face. The first example concerns establishing an intermarket 
+spread in oil products. 
+Example: In late summer, a spreader decides to implement an intermarket spread. 
+He projects that the coming winter may be severely cold; furthermore, he believes 
+that gasoline prices are too high, being artificially buoyed by the summer tourist sea­
+son, and the high prices are being carried into the future months by inefficient mar­
+ket pricing. 
+Therefore, he wants to buy heating oil futures or options and sell unleaded 
+gasoline futures or options. He plans to be out of the trade, if possible, by early 
+December, when the market should have discounted the facts about the winter. 
+Therefore, he decides to look at January futures and options. The following prices 
+exist: