Recent content by trickyname

I'm surprised no one has mentioned this yet. Not only is SPX more liquid at larger sizes, but the tick increments are .10 in spreads above 5.00, as opposed to .25 in ES.

So, to recap: you're angry they sold your options for .02, because selling for .02 is better than a DNE, yet you wanted to have them marked DNE so you could continue trading until the close? You're right, this is a common strategy used by prime brokers to collude with market-makers to force...

You realize that even for ITM options, there are plenty of times shortly before expiration where there is no bid for the system to hit, right? And if there was, in the case of your ".14" options, would you have been happy if the bid had been hit on a .02/.15 market?

If there is more delta being traded than is available on the bid (or offer), then yes, it can move the underlying market. In the case of option buyers, the effect of convexity on the hedging MM's have to do against their shorts can exacerbate large moves.

If he's trading KOSPI, he'll be trading on the screens. It's a different style of market than the US equity option market, so perhaps they're not sure how to instruct, but my guess is it's going to be a very short leash.

Keep in mind this is just for proprietary CBOE products, not equity options in general. The latter would require a much larger market-wide reform and would involve all of the equity option exchanges, not just the CBOE.

For the purposes of SOM under SPAN, there is no such thing as a spread. Each short leg is margined without regard for any longs in the account. And the reply from IB is just stupid. In case of a margin call, they could liquidate your long spread for a debit, which would only exacerbate the...

I'm aware they're cash settled, which is why treating the VIX as a "commodity" makes no sense. However, if people are being told that VIX is being margined using SPAN, then what I wrote above still applies. The CME developed SPAN, so any literature that you can find on their website regarding...

Draw a payoff diagram for each option, assuming HLF is trading around 60 like it is in your picture. You will find the answer.

Fairly sure you're running into the issue of Short Option Minimum in SPAN. From the CME's website: Your scan risk would be equal to the cost of the spread, so that's what most people would think they'd be charged on. However, the spread is made up of a long and a short leg, so while the long...

Priority only exists if a customer order is on the BBO; if the price is improved in an auction and there is no customer interest at that level, then priority wouldn't apply.

Everything (SPX, SPXW, SPXQ) is traded in open outcry. The differences lie in how electronic orders are handled.

Priority for customers exists in all option classes, so you will cut ahead of everyone else except other customers.

She's back at it in the VIX, selling the Nov 24 calls hand over fist.

Ironically, the SPX is on the Hybrid 3.0 system, while everything else remains on Hybrid 2.0. The good news is that later this summer, CBOE will be moving SPXQ options expiries to the SPXW symbol, meaning they will share the same platform and benefit from competitive electronic quotes. That...