Probability of Touch

Discussion in 'OptionNET Explorer' started by monaco100, May 10, 2017.

  1. monaco100

    monaco100 Member

    I am trading the Road Trip Trade and I have recently moved to ONE after becoming a little frustrated with OV.

    Is there a probability of touch setting or equivalent in ONE. I have spoken to ONE, who did not quite understand.

    Appreciate your help.

    Good trading
  2. PK

    PK Well-Known Member

    No, ONE does not provide this feature.
    You may consider asking them to add this setting to ONE updates. If you go to the "support" menu, there is a "features request" tab which takes you to requests for improvements made by ONE users. You can bring up your own proposal and also support others you find useful with your vote. As far as I have seen, the probability of touch setting is still not on the list. Color tabs highlight requests that are currently being implemented or that are planned for the near future. For example, trading futures options - one of the top rated requests - will be included in a forthcoming update.
  3. monaco100

    monaco100 Member

    Thanks Peter
    Will certainly make a request.
  4. onyxperidot

    onyxperidot Well-Known Member

    Options traders' rule of thumb:
    1. Probability of an option expiring in-the-money is approximately equal to its delta, e.g. a 25-delta call has a 0.25 probability of expiring in the money.
    2. Probability of an option touching its strike price any time before its expiry is approximately double its delta. The 25 delta call should have a 0.50 probability of touching its strike price during its life span.

    Many financial engineering text books provide the formal mathematical derivation of the probabilities.
    DAviator likes this.
  5. Todd B

    Todd B New Member

    Thanks Peter for pointing out that "features request" tab, wasn't aware of it. Awesome to see that futures options should be coming out sometime in the future :)

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