Best order type to trade illiquid options

T

tonyf

I am trading short dated illiquid options in size with visible limit orders with IB.

The idea is to place a limit sell order at $0.1 per contract pre-open, and peg this order to the market ask all the way down to $0.05. I have no interest in selling the option below 0.05.

Is Trailing Limit if Touch what I need to use or are there better algos able to achieve this?
 
tonyf said:
Looking into REL just now - how do you set a floor in that case?
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Your limit is the floor.

Say your limit is 0.05 and offset 0 and bid/ask is 0.05/0.08.
Then your order will be at exchange with limit 0.08.

If ask goes up to 0.09 your order will remain at 0.08.
If ask goes down to 0.07 your order will follow to 0.07.
If ask of other orders goes back up to 0.08, it will also remain at 0.07.
 
JamesJ said:
Your limit is the floor.

Say your limit is 0.05 and offset 0 and bid/ask is 0.05/0.08.
Then your order will be at exchange with limit 0.08.

If ask goes up to 0.09 your order will remain at 0.08.
If ask goes down to 0.07 your order will follow to 0.07.
If ask of other orders goes back up to 0.08, it will also remain at 0.07.
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what if ask drops to 0.04?
 
JamesJ said:
Your order stays at 0.05
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thank you.
Just trying it out on TWS - REL option orders are not transmitted to the exchanges pre-market. They hold them on their server until a price is established from what I see.

This is a drawback I guess...
 
tonyf said:
thank you.
Just trying it out on TWS - REL option orders are not transmitted to the exchanges pre-market. They hold them on their server until a price is established from what I see.

This is a drawback I guess...
More...

Yeah, they obviously need a quote before being able to submit.
 
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