Crude Oil
BULL SPREAD EXAMPLE
The price of crude oil has been on the rise all week, and you expect continued confidence from investors this morning.
In this example the underlying crude oil futures market is trading at around $101.15 and you decide to trade a Bull Spread.
CHOOSE MARKET
You believe the price of crude oil will rise throughout the morning.
You choose:
Crude Oil (Jan) 100.75-102.25 (2PM)
This contract is due to expire at 2pm today.
COMPLETE TICKET
You choose to Buy because you think the crude oil future will be above 101.17 at 2pm.
You select 5 contracts. Each contract is worth $1 per point.
Your Maximum Profit and Loss are displayed automatically.
The 'floor' and 'ceiling' is 100.75 and 102.25 respectively.
The most you can make is $540; the most you can lose is $210*.
MONITOR TRADE
Your position will expire at 2pm.
The difference between Nadex's calculated expiration value and your opening price of 101.17 will determine your profit or loss.
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PROFIT
At 2pm, Nadex's calculated expiration value for crude oil has risen to 102.15.
The difference between your opening price (101.17) and the expiration value (102.15) is 98 pips.
Multiply 98 by the number of contracts (5) and the contract value per point ($1) to calculate your gross profit.
98 x 5 x $1 = $490*
*Fees apply -
LOSS
At 2pm, Nadex's calculated expiration value for crude oil has fallen to 100.95.
The difference between your opening price (101.17) and the expiration value (100.95) is 22 pips.
Multiply 22 by the number of contracts (5) and the contract value per point ($1) to calculate your gross loss.
22 x 5 x $1 = $110*
*Fees apply
More examples
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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.