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Appreciate the clarification. So not only do locked markets happen all the time, they happen all the time in exactly the way we've been discussing in this thread. They happen because a naive investor like me, naively uses IB's SMART routing, which uses PHLX, who pays IB the most. No wonder I see...

I would bet that if several brokers are tied for the best price, SMART routes to the exchange which returns to IB the highest 'payment for order flow'. When you say 'marketable order' do you mean market order? I mostly use limit orders. I should cross-reference this thread where fframe38...

And I thought I was being SMART by selecting SMART routing and having it end up at PHLX...

Do you prefer to route your options trades to a specific exchange? After voting in the poll, do post any comments as to why.

I PM'ed def; will advise. There was also some earlier discussion of "just route a Price Improvement order but use SMART and it will end up at BOX" but I can't seem to get that to work, TWS gives me an error message. I'm happy enough at IB, though the question should be asked: how can I...

"Liquidate First" would be a good improvement to TWS. I guess for now all one can do is set everything BUT the "Liquidate First" to Liquidate Last.

What actual implications does this have? What I want is penny pricing, instead of getting nickel and dimed.

I have an interesting theory about the implications of my one-or-two options contracts bids, which IB SMART routes to PHLX. Take a look at this article first http://www.siliconinvestor.com/readmsg.aspx?msgid=16195448 Now, my theory is that, I'm accidentally stimulating behavior like that...

I direct your attention to the "View... Account..." window of IB's TWS software. 1. In the prominently featured "Margin Requirements and Trading Limits" panel, do investors with large box spreads get any indication that they are running close to the edge? 2. In the "Portfolio" panel, would using...

Definitely noticing IB routing a lot of my options trades to PHLX. WTF is the problem with PHLX? They're trying to get more transactions, so they pay larger fees than other exchanges, and IB charges low fees, but they make it up on the kickback from the exchange... But then the execution suffers...

Is the SMART routing behavior described above also an issue with straight equities? I guess to the extent a given stock is more liquid and has less bid-ask spread, the problem might be not be as noticable.

It does seem like an inordinate number of the stale unfilled orders are PHLX. (I am assuming I can use the numbers flashing by on TWS (are they called level II quotes?) to see others getting filled at the price I staked out). I mean it the volume numbers at my bid spin up and down while my limit...

Using SMART routing. I'd like to use Box and price improvement, but IB charges extra when you direct route, and it seems this would cancel out any savings from the 50% chance of a penny (buck) or two price improvment.

Only 3000 or 4000 underlying even have options. Within that maybe 1600 trade actively. I also read that the top 900 stocks account for 95% of all option trades. So it sounds like sticking to those 900 when possible may improve the problems I've raised. It could also be that when I post my bid I...

CYMI FFIV JBHT JOSB KOMG SII Buying March 2006 OTM calls

I'm with you so far, but I guess I'm looking for a little more understanding of how the market maker operates. e.g. do they have any injuntion to sell the bids (at a given price point) "first come, first serve" (if a buyer shows up)? Why are the bid-ask spreads so great? Does the MM have an...

By odd lot I mean 1 or 2 contracts: 100 or 200 shares. Account has $5000, still undercapitalized.

I've been trying to trade odd lots of options contracts using limit orders and I've noticed two things. 1. It seems like even if I'm the best bid often nobody will sell me a contract. 2. It seems like even if I'm the first bid at a given price, and then the stock moves down and other bids...

Does "set liquidate last" help protect box spreads? Does IB's information box "Margin Requirements and Trading Limits" indicate that you are running close to the edge?

For example: QLGC MAR06 42.5 Call Bid: .60 Ask: .70 Model: 0.09 You're right, if I change the volatity to 2.4, the model price goes to 0.96. Where does TWS get its volatilities... and where should I...? For that matter, I'm not entirely sure what that number means, is it one...