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Sorry you're right on the hard to borrow I got it backwards my apologies. Been a while since I dealt with that issue. Thanks for correcting me.

The expense on exercising the put will never be less then the cost to cary the put vs the cost of short stock unless the stock is hard to borrow.

Actually its rare to be assigned early on calls unless there is a dividend involved. There is an expense involved in doing an early exercise which means unless you need the stock to collect the div there is NO normal reason to early exercise them. Of course this assumes we’re not looking at...

I am talking about when retail traders lift offers of mm's. They have no worries, any big institutional order is going to be shopped all over they wont just lift the crowd.

Larry McMillan... the noted options author had a piece in Barrons witch made a good case why the SPX puts are not a good hedge for a broad based portfolio and the VIX options are. Pretty interesting.

Anytime you’re lifting the offer of a market maker he’s happy. Don’t kid yourself into thinking they don’t hedge that stuff with the futures. I love days when the index ( spx ) is 5 or 6 bucks and the front month .30 delta call is unchanged on the day and the calls below them on the...

How do you know the OI in the puts where buy to open in the puts? You simply have no way of knowing. OI is not a good tool for that.

I dont see where Rosey says he/she is talking about individual tradeable incorrect pricing. He/She seems to think they're all wrong all the time and markets are so inefficient they just sit there priced wrong all the time.

Its very simple... as I said when the market in xyz options are 1.40 / 1.55.... in order to do the cross they simply bid 1.41 or offer 1.54 and then hit the bid they showed or lift the offer they showed. It happens continually all day long every day.

There is no guess work at all anymore, those days ended years ago. The FACT is that if those options are priced wrong then somone somewhere in the world would be making a bundle off them. This is a moot point being that you cant offer a single answer to the questions posed or show an example.

Richard... I have many years in the business and I don’t really want to get into the specifics on my background. I am currently with a group that runs several strategies... dispersion, off floor liquidity infusion / prop trading in a few dozen names and our own prop model on S and P...

Fair enough rosy2. Could you please tell us then how if these options are not priced correctly why the world does not swoop in and do it correctly? Can you select .... say a SPX put thats priced wrong for an example and tell us why its wrong and tell us the correct price?

rayl, You’re right and you’re wrong. You’re right in that the crosses have to be printed (put on the tape) at one of the six exchanges. The thing is in the last 5 years the rules for crossing have changed substantially. It used to be that you had to show your orders to the pit first...

Again if they were over priced or under priced the WORLD would step in and price them correctly. If its your opinion they're priced wrong thats fine, then please indicate what the correct pricing is and explain why? The “world” would say they’re priced correctly being that no one...

Yup it’s just repackaging of risk and rolling it into liquidity, hopefully and usually for tiny edge and big volume. It’s a traders dream to find options priced incorrectly and then just slam them back to the correct parameters.

There are several variables in the price of an option and each impact the change in the price in different ways. In addition some have a greater effect the closer you get to expiration. If I read your dates correctly you’re only 5 or 6 days away from expiration. If that’s correct then...

Thanks I guess IV... it has to be better then that other board!

The MM’s do a poor job of pricing? Sorry but no matter what the underlying these days, you name it, any futures contract or any equity product or currency or debt product there is NO mystery in the pricing of the OTM stuff. In fact the pricing comes form years of historical data on that...

I am a new poster here but I will chime in. Here is my thought. What’s the point of bragging about any returns at all on line since no one is opening their actual books and showing all? Isn’t it easier to assume that every method anyone can come up with works fantastically? Not...

If you see a spike in Put volume without the underlying having moved much or having it actually go up some what do you believe you've learned?