But any of you readers know how I could go about purchasing a put option on the price of crude oil?
1) Needs to be an option, not a future. Hey, I\’m a private investor.
2) Reasonably long term: 12 months or more if possible.
3) Well out of the money….like $70 a barrel stuff.
OK, so I\’m pretty certain that the financial markets are sophisticated enough to be able to deal with all of the above. However, I have a feeling that they might only be for "professional" investors, ie, dealing in sums far larger than the £1k-£1,500 I might be willing to lay out on such a bet.
So, anyone actually know?
Spread betting? Mind you, the forward bets on IG Index only go to July 08.
Alternatively, you could short an ETF (e.g. OILW).
Ask Lind Waldock, if they’re still around. Pretty decent bunch (or at least they were ten years ago when I was with them).
Have a look at SG’s “covered warrants” – I think they’ve expanded into commodities etc.
I’d second Kay Tie’s advice, except to add that (and I think this is really the best thing you could do, even though its probably not as leveraged as a proper future) is to buy this
http://www.etfsecurities.com/csl/short/etfs_crude_oil_sh.asp
This is a ‘short crude oil etf’. For every 1% it falls in price, you gain 1%. And vice-versa. You can buy it with a normal share account.
For some reason I missed your bit about options not futures. But I’d still look into that.
Tim adds: I was just about to add that to the last comment, having looked at it. Want a fire and forget, not one that leaves me open to margin calls.
I’d look at the short ETF. There aren’t margin calls – you’ll just find one day that you have no investment.
You could try Spreadfair or even Betfair – either of them should be able to supply *someone* to act as counterparty
I can get you an actual barrel if you like. You’ve gotta pick up the delivery tab though.
Hillary Clinton would know: she learned all about how to do this from reading the WSJ.
Call her … I hear she’s sweet and approachable.
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