a day or so ago I was thinking about the MMMs and decided to try to concoct an option trade. On 3/2/16 the MMMs were trading at 80.70 and the component was at 67.00 for a premium of 13.70. That's quite wide. Usually that far in front of expiration the index will gain six to seven point by expiration of the MMMs. In 2015 the index actually lost -15.42 and in 2013 it tacked on 25.71.

I doubt that either of those two extremes will be taken out this year. My thoughts were that the MMMs would reach the 82 to 84 by expiration. Here is the option trade I entered to play that hunch:

3/2/2016 Jun 84. - 1 Calls 1.88
3/2/2016 Jun 82. 1 Calls 2.75
3/2/2016 June 78. -1 Puts 2.350
3/2/2016 June 76. 1 Puts 1.750

It cost me $110.00 plus commissions to put on the trade. It has a maximum risk of $910.00 plus commissions and a maximum profit of $690.00 less commissions. Not particularly great ratios but with a bullish bias I was willing to take a traders risk.

Best wishes,

dhm