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Central Ohio | I'm going to need to cash out some corn basis contracts and I want to reown. I was looking at March 2018 corn calls for their strike price of $3 and it appears there is only half a cent of Time Value in those and your downside is limited to the premium of $0.69. I was wondering if that is a good alternative to going long march corn futures. Of course a person could do this on any month it looks like you have to get about $0.60 in the money as opposed to $0.70 in the money for December 2017 corn calls to get to the point where the time value basically disappears. Calls that deep in the money on nearly any month should move penny for penny with a market I believe am I right on that?
Plus if the market moves lower in the next couple months a person would not lose all the premium on the March calls they may go from $0.70 to 20 or $0.30 if Market move down to $3 until It got closer to expiration
What pros or cons am I missing?
Edited by jbweston 8/24/2017 11:43
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Deep in the money corn calls as opposed to long futures?
