Personal Investments • SPX Box Spread Loan - Optimal size for the lowest effective interest rate

What is the optimal size of an SPX box spread when borrowing relatively high amounts?

For example, let's say I'm intending to borrow $1m. There are many ways that I could approach this. Here are a few options:

• sell 1 SPX box spread for $1m
• sell 2 SPC box spreads for $500k each
• sell 5 SPX box spread for $200k each
• sell 10 SPX box spread for $100k each

I'm speculating that there is more liquidity, and thus potentially lower pricing, at certain sizes.

Does the expected effective interest rate of an SPX box spread differ by size? If so, what size SPX box spread is expected to provide the lowest rate?

Statistics: Posted by Lowlim — Mon Jun 03, 2024 4:51 pm — Replies 0 — Views 43

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