Have you ever wanted to express your view on the crude oil market but were hesitant because of the large contract sizes or premiums?

Now you can trade smaller sized options on CME Group’s global WTI Crude Oil benchmark with Micro WTI Crude Oil options.

Micro WTI Crude Oil options can be used to express an opinion on whether futures prices will rise or fall.

Purchasing a call option could allow the buyer to profit if the underlying futures price rises above an agreed upon price, which is called a strike price.

For example, suppose Micro WTI Crude Oil futures are currently trading at $90 per barrel and you believe that the price will increase by more than $5. You could express this view by purchasing a Micro WTI Crude Oil call option with a strike price of $95 per barrel for a $0.75 per barrel premium. The option will become profitable if Micro Crude Oil futures increase beyond $95.75 per barrel. If the price of Micro Crude Oil futures finishes at or below $95 per barrel, the buyer will have risked the $0.75 paid for the call.

On the other hand, suppose you believe that the price of WTI Crude Oil will decrease by more than $5. You could express this view by purchasing a Micro WTI Crude Oil put option with a strike price of $85 per barrel for a $1.40 per barrel premium. The option will become profitable if Micro WTI Crude Oil futures decrease below $83.60 per barrel. If the price of Micro Crude Oil futures finishes at or above $85 per barrel, the buyer will have risked the $1.40 paid for the put.

No matter where you believe the price of Crude Oil futures is heading, Micro WTI Crude Oil options can be a flexible and a cost-effective way of expressing your trading opinion.