Series 3: 5.1.3. Synthetic Futures

5.1.3. Synthetic Futures

A futures contract can also be created synthetically. A synthetic long futures position is the combination of a long call and a short put, both with the same strike price and expiration date. A synthetic short futures position is a combined short call and long put with the same strike and expiration.

With synthetic futures, the price you pay for the long option