503
OPTION TrAdINg STrATegIeS
 Strategy 5a: Long put (at-the-Money) 
example . Buy August $1,200 gold futures put at a premium of $38.70/oz ($3,870), with August gold 
futures trading at $1,200/oz. (See Table   35.5   a and Figure   35.5   a.)   
    FIGURE   35.4d    Profi  t/loss Profi  le: Short Futures and Short Call Comparisons (In-the-Money, 
At-the-Money, and Out-of-the-Money) 
Price of August gold futures at option expiration ($/oz)
Futures price at time
of position initiation
Short futures
At-the-money call
(strike price = $1,200)
Out-of-the-money call
(strike price = $1,300)
In-the-money call
(strike price = $1,100)
Profit/loss at expiration ($)
1,000
10,000
15,000
−10,000
5,000
−5,000
0
−15,000
−20,000
1,050 1,100 1,150 1,200 1,250 1,300 1,350 1,400
 tabLe 35.5a     profit/Loss Calculations: Long put (at-the-Money)  
(1) (2) (3) (4) (5)
Futures price at 
expiration ($/oz)
premium of august $1,200 
put at Initiation ($/oz)
$ amount of 
premium paid
put Value at 
expiration
profit/Loss on 
position [(4) – (3)]
1,000 38.7 $3,870 $20,000 $16,130
1,050 38.7 $3,870 $15,000 $11,130
1,100 38.7 $3,870 $10,000 $6,130
1,150 38.7 $3,870 $5,000 $1,130
1,200 38.7 $3,870 $0 –$3,870
1,250 38.7 $3,870 $0 –$3,870
1,300 38.7 $3,870 $0 –$3,870
1,350 38.7 $3,870 $0 –$3,870
1,400 38.7 $3,870 $0 –$3,870