The Option Model for the New Millennium.

CME Options on 110k Lumber Futures
This chart shows the value of the OSCC Total Dollar Normalized Option Premium for these options. 
  Comments and analysis can be found in our when appropriate..

How to read and use our charts.
Our charts show the daily average of the "OSCC Relative Normalized Total Dollar Option Premium" or "NTDOP" values of current contracts, assuming there are enough strike prices with values to make the calculation.  The charts enables a trader to see our opinion of how option premiums are changing. Option premiums change for two basic reasons. The risk that the future is going to move up or down because of market factors (this is market risk or "OSCC Real Risk") and the risk the trader takes for the amount of the change in the value of the future itself. See the NASDAQ 100 futures and option charts for a good example. A trader would of course expect a futures contract of a $1,000,000 to have a higher premium than one with a value of $100,000, market risk being the same. We remove that part of the premium by "Normalizing" the future to a value of $100,000 for one of our calculations. That is, we take out what we consider future change premium. What's left is market or the OSCC Real Risk.  Because of the way it is done, the number can be larger or smaller than the NTDOP. What is important is their relative spacing and pattern. If the "normalized premium drops away from this line it lacks "future value". Either premiums need to increase or the future needs to drop the bring the "future adjusted value down.  The reverse is also true if the "normalized premium pushes up towards  "adjusted value", either it has to much premium or the future has to rise to compensate. The lower the overall adjusted premium is means you are using less premium dollars for every $100,000 dollars of  futures you are leveraging.  Brokers can help with strategies to take advantage of these projected values. We, of course, are not responsible for any decisions a trader may make using these charts. We are not writers so if you have comments (good or bad), requests, questions, or need an explanation of our charts Please contact us at:
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110k Lumber Return to option charts index page Go to Lumber Futures chart
Go to Lumber Option Premiums Go to Lumber Combined chart
Go to Over & Under Priced Call Options Go to Over & Under Priced Put Options


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We have a new "chart explanation page" to help explain how our charts look over time
This page includes an explanation of what these charts are and how to use them.
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Last Updated on 10/31/2019 By Tom B
As used throughout this web site: 10/31/2019

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This site relates to option trading of commodity options and futures with strategies that buy or sell puts and calls either long or short for profit on treasury bonds and notes, Dow Jones Index, soybean products, corn, wheat, oats, rough rice and T-Bond options on the CBT, Chicago Board of Trade through "floor traders". We are also doing 6 currencies from the CME, the Chicago Mercantile Exchange, the Japanese Yen, British Pound, Swiss Franc, the Euro FX (ECU) and the Australian and Canadian dollars. We also do 5 agriculture products, the S&P 500, NASDAQ 100 and Eurodollars related to European and Economic Monetary Union (EMU) interest rates. Commodities are a high risk speculative hedging investment and traders should use brokers for trading contracts who keep their funds and money in accounts with high rates. This site provides free commentary, and technical analysis on commodity futures and option premiums by OSCC from our futures charts and option charts for use by traders.
This site no longer provides free quotes, although we do provide a free commodity ticker.