RBOB Unleaded Gasoline Futures and
Options Market Trading
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T & K Futures and Options, Inc.
is a federally licensed U.S. corporation specializing in helping investors
implement futures and options investment strategies. We are happy to answer all of your questions about Unleaded Gas
Futures and Options. Click here for answers to your
questions.
Unleaded Gas Futures Trading Facts
Gasoline is a complex mixture of hundreds of lighter liquid hydrocarbons used in
internal combustion engines.
Gasoline makes up the largest "cut" from a barrel of crude oil. Approximately
half of the barrel of crude oil is refined into gasoline.
Gasoline is the largest single volume refined product sold in the United States
and accounts for almost half of national oil consumption. Congress amended the
Clean Air Act in 1990 to mandate the addition of ethanol to gasoline.(RBOB) Reformulated gasoline blendstock for oxygen blending
is the gasoline used since the banning of MTBE as an additive to gasoline.
RBOB Unleaded gas future contracts are one of the
largest distillates of crude oil contracts traded at
the NYMEX. Unleaded gas future contracts may be the most important
energy future of all of the petroleum distillates.
Unleaded Gas Futures and Options Quick Facts
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learn about other commodity markets.
The formula for unleaded gas is adjusted based on the temperature that is
anticipated for a certain marketing area up to six times per year. The purpose
of this adjustment is to help the gasoline vaporize more readily. Especially in
winter facilitating cold starts and better driving performance.
During the Sept. 11 attacks the NYMEX was destroyed
but because of the strength and resilience of the
futures markets and the exchanges, the unleaded gas future contracts were trading within
days of the attacks. This is a testament to the
futures markets reliability and integrity.
The NYMEX Division New York harbor unleaded gasoline future contracts trade in units of 42,000 gallons (1,000
barrels). It is based on delivery at petroleum
products terminals in the harbor, the major East
Coast trading center for imports and domestic
shipments from refineries in the New York harbor
area or from the Gulf Coast refining centers.
Contact us at contact@tkfutures.com
for specific unleaded gas futures and unleaded gas options data.
Along with the unleaded gas futures contracts, options contracts, calendar
spread options contracts, crack spread options contracts, provide a slate of flexible, liquid
financial instruments.
Unleaded Gasoline Options
NYMEX Division Unleaded Gasoline options provide a
flexible means for hedgers (commercials) to achieve
price protection while retaining the ability to
participate in favorable unleaded gas futures price moves. The
opportunity cost is limited to the premium paid for
the option, plus the commissions and fees.
Unleaded Gas Options Defined
There are two types of options: calls and puts. A
call gives the buyer the right, but not the
obligation, to buy unleaded gas futures at a specific price (the
strike or exercise price) for a specific period of
time. A put gives the buyer the right, but not the
obligation, to sell unleaded gas futures at a specific for a
specific period of time. Learn More >>>
Buying a call or a put is similar to purchasing an
insurance policy: In return for a one-time up front
premium, the buyer obtains protection against the
occurrence of a risk. To protect against the risk of
a unleaded gas futures price increase, a hedger would purchase a call, to
protect against an unleaded gas futures price decrease, he would buy a
put.
If
the price move does not occur, that is, if cash
market (spot) prices do not move in an adverse
direction, the options buyer forfeits only his
premium and is otherwise able to participate fully
in any favorable price move.
An
options seller (or writer) performs a function
similar to that of an insurance company. The seller
collects the premium and is obligated to perform,
should the buyer exercise the option. If the option
expires without being exercised, the options seller
profits by the amount of the premium.
Unleaded Gas futures contracts have been used to manage cash
market price risk for more than a century in the
United States.
Hedging allows a market participant to lock in
prices and margins in advance and reduces the
potential for unanticipated loss.
To
visit other energy futures visit
crude oil futures,
heating oil futures
and natural gas futures.
To
open an account click online
commodity trading.
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