Apart from selling options , what other instruments can I trade(sell) to collect a premium ? The main problem that I face is as follows :

I am buying a Call option which I would like to fund by selling something else . I want to avoid selling an option in the same underlying or a correlated underlying . A solution to this would be to go for Commodity or Currency options (since the call option I am buying is in Equity markets) . Apart from options is there any other instrument that can be sold to collect the premium (to fund the call) ?

  • $\begingroup$ Bonds, equities, CDS, ... $\endgroup$ – Chris Taylor Mar 13 '17 at 15:14
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    $\begingroup$ Funding the purchase of one option by selling another is a nice way to end up getting nice and hurt - take PRDCs, for example. $\endgroup$ – will Mar 13 '17 at 17:36

no, generally speaking only options has time premium. I strongly advise you to avoid mixing 2 positions (short 1 option, long another one) in your mind just because they are independent, so just consider each leg as an independent trade which should be profitable by itself, without other legs.


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