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Yeah, I know about the differences, but what I really meant is that since your dad is in the industry he might be a better person to help you find who to go with and what to do.

Your dad is a CBOT trader and you come here for advice!?:confused:

Why don't you just go the "books" section on this site and see what they have there, plus you can read the reviews.

Companies do not issue exchange-traded options, the exchange lists them. For more info see www.cboe.com

It depends, options can move quite a bit. Obviously in $ terms the movements are quite small, but in % terms the moves can be really big. For example, a Jun 116 put on SPY is down $0.10 at the moment, given that it is trading at about $0.75, that's a 11.7% drop, even though SPY is virtually...

Ask IB what inputs it uses? I.e. where does it get it's volatility estimate and so on...

A model is just a model, it gives you the price based on the inputs, so if the volatility that the model uses is different from what the market is implying then you'll get a different value, but does that really mean the option is mis-priced!?

No worries, Phil. Just a thought. Good luck with your trade.

No worries.:)

I wasn't implying that you should try to get $0.75 on the 5-pt spread, but here's what I meant: When I looked the quotes they're as follows (mid-points): 1230/1235 - 0.35 1230/1245 - 0.9 So, instead of one 15-pt spread for 0.9 credit you can do three 5-point spreads for 3*0.35=1.05...

Phil, How do you choose the long strike? I mean, looking at the current quotes (mid-points) a 5-pt spread (1230/1235) gives a better risk/reward ratio than a 15-pt one you got.

Looking forward to it, Phil.:)

Yep, .05 is the minumum.

Maestro, If you don't mind me asking, where do you put limits? I.e. at the bid for buy/ask for sell, mid-point....?

Think of it this way, if an option only has 1 min to expiry and it is right ATM. Even a slight move in the underlying one way or the other could mean that it expires either ITM or OTM, so the uncertainty of what's gonna happen is really great. It's a somewhat extreme example, but I hope you see...

The reason that ATM Gamma increases (OTM/ITM Gamma decreases) as time passes is because the uncertainty of whether ATM options will expire ITM/OTM increases, but the uncertainty of ITM/OTM options decreases. You can think of Gamma as the amount of uncertainty of whether the option will expiry...

As it has been previously mentioned this position does not really have any meaning as a combo, so to speak. So, maybe if you explain why you want to use this combo, you might get a more meaningful answer. Is there something specific you want to use it for or are you just trying to construct...

Essentially it is the same as a long stock position.

Yes, that's right.

Where did you get $60 from? 1 Std is about $21 based the current stock price, volatility and time to expiry, and the ATM (230 stike) June straddle is trading at about $16.20. So the market expects a move that is smaller than 1 Std.