Wall Street 30
BULL SPREAD EXAMPLE
Profit warnings from a number of key companies have depressed the stock market.
The CME® E-mini Dow® Future is the basis for our Wall Street 30 contracts, and for this example is trading around 11790.
CHOOSE MARKET
You think sentiment will deteriorate further during the trading day, as investors digest the implications of the profit warnings.
You choose:
Wall St 30 (MAR) 11700-12100 (4:15PM)
COMPLETE TICKET
You Sell as you think the index will be below 11791 at 4:15pm.
You select 8 contracts at the bid price of 11791. Each point that the price moves is worth
$1 per contract.
Your trade's floor and ceiling is 11700 and 12100 respectively.
The most you can make is $728;
the most you can lose is $2472*.
MONITOR TRADE
Your position will expire at 4.15pm.
The difference between Nadex's calculated expiration value and your opening price of 11791 will determine your profit or loss.
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PROFIT
At 4:15pm, Nadex's calculated expiration value for Wall St 30 is down at 11728.
The difference between your opening price (11791) and the expiration value (11728) is 63 points.
Multiply 63 by the number of contracts (8) and the contract value per point ($1) to calculate your gross profit.63 x 8 x $1 = $504*
*Fees apply -
LOSS
At 4:15pm, Nadex’s calculated expiration value for Wall St 30 is up at 11973.
The difference between your opening price (11791) and the expiration value (11973) is 182 points.
Multiply 182 by the number of contracts (8) and the contract value per point ($1) to calculate your gross loss.
182 x 8 x $1 = $1456*
*Fees apply
Stock Indices
More examples
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Stock Indices
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Commodities
Bull Spreads
Bull Spreads are simple derivatives suitable for traders looking for high leverage and hedging opportunities.
Bull Spreads
Step-by-Step Guide
An in-depth guide to placing your first Bull Spread trade, from the first step to the last.
