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Strategies & Market Trends : DAYTRADING Fundamentals
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To: Dan Duchardt who wrote (14322)10/3/2001 11:23:42 PM
From: Dominick  Read Replies (2) of 18137
 
HI Dan!

The ratio of futures points to index points is nominally 1 to 1

So if the NQ Z1 is down 15 points the composite will open 15 points lower and the S&P 500 would also if it's e-mini were the same?

The futures are a bit higher to reflect the interest rate on the money tied up in the futures....

That brings up a question I'm having a problem with. I know the opportunity cost is included in the premiums when they sell an option or futures, because they say I could've made interest on my money. But are they not getting money,(premiums), back when they sold the derivative? And isn't that premium earning interest?

So how much extra are we talking about in dollars and cents for interest opportunity cost? You would've thought the buyer should get the discounted rate for he has a true opportunity cost.

TIA,

Dominick
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