Ninjastic
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Board Service Announcements (Altcoins)
Re: [ANN] Sparrow | Leading options trading platform powered by smart contracts
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Sparrow Exchange
on 25/07/2019, 13:32:19 UTC
Quote from: puremage111 on July 25, 2019, 01:16:31 PM
Quote from: Sparrow Exchange on July 25, 2019, 10:46:13 AM
Quote from: puremage111 on July 25, 2019, 09:33:33 AM
Quote from: Sparrow Exchange on July 25, 2019, 06:09:24 AM
Quote from: puremage111 on July 24, 2019, 10:07:19 AM
Alright so we have 2 things there

TradeProtect and TradeBoost
Hope i get this right

TradeProtect
If i make a call option at $220 per Ethereum, current Ethereum price is $200, within the expiry date, if the Settlement price is $230, i will earn $10 per Ethereum contract right?

How about TradeBoost?
I don't get how tradeboost work here
It allows us to sell an OTM Options, and why are we getting paid the premium here instead of paying the premium?
Lets say current price for Ethereum is $200
I put the strike price at $220, it allow me "Obligation to sell at $220"
So i am currently having a call/put options here?
Shouldn't putting a strike price above spot price "an Obligation to buy at $220"?

EDIT: Oh, hope i get this right
For TradeBoost, instead of being the options buyer. I am now the options seller?


Kindly help, thanks


Hi puremage111,

Thanks for your interest!

You’re right, TradePROTECT = buying options by paying a premium (can be buy call or buy put) while TradeBOOST = selling options and collecting a premium  (can be sell call or sell put)

For your TradeBOOST scenario, where you put strike price at $220 when the current ETH price is at $200. It is a sell call position – meaning you are bearish and think the price will not exceed $220.

You get an instant premium from being an options seller - If it goes above $220, then your option will be exercised, otherwise it will expire worthless. Of course as a seller, you will hope that they expire worthless so that you can profit from the premium.



Hope this helps! Do join us on our Telegram chat: https://t.me/SparrowExchange - Our team and communities are active there where we often share options trading tips and strategies. Feel free to ask us any questions there!  Smiley



Alright thanks for the help
So for Sell Call/Sell put options

Lets say current price is $200, Strike price is $220, Settlement Date is 1 week Later
So For Day 2, if spot price touch and hit above $220, the options is closed straightaway?
Or it will depends on the final price during the settlement Date?
Thanks

Another Scenario (For TradeBoost)
Ethereum Current price $200, if i set the strike price at $180, this will be a sell put options right?
Hence if i wanted to profit from this, i will hope that the price of Ethereum never hits $180 or else my options is close?

Thanks

1. It will depend on the final price during settlement day. Sparrow Options are European Options - meaning options will only be settled on settlement day

2. Thats right! For sell put, you are kinda betting market will go up - so if strike is 180, your stance is that eth price will not go lower than 180. If it goes below 180 then the option will be exercised


Do make sure to not set your strike price too far away from the current price though, to ensure your order gets filled - so far on Sparrow, more than 90% of orders get filled  😉



Alright thanks for the help!
For the part
"Ensure your order get filled", whos buying into my Options if i were to sell one?
Is it filled automated by algorithms? Or i need to ask people to buy the Sell Put/Call Options from me?

Thanks


No problem at all! All orders will go into the order book, which may be picked up by a counterparty - could be another user, or one of our market makers