Covered call vs. short put?

[nitro]

Quote from atticus:

So you're crossing an exchange trade outside the market? Sure, that's legal.

We are just making a bet, sheesh.

 

[atticus]

Quote from nitro:

We are just making a bet, sheesh.

You stated you would make him a market, right?

 

[nitro]

Quote from atticus:

You're arguing microstructure, which is absurd. It's more likely the natural will outperform the synthetic due to microstructure, unless you're a local.

That is true, but not always. That is the contention of the bet. And yes, mostly [only ?] locals can take advantage of it.

 

[nitro]

Quote from atticus:

You stated you would make him a market, right?

Either way, and just for a bet. But you are right, I have to be careful.

Let's just make it a gentleman's bet.

 

[atticus]

Quote from nitro:

Either way, and just for a bet. But you are right, I have to be careful.

Let's just make it a gentleman's bet.

It's not my bet, but let's assume that you're inside NBBO on your market. It's more than likely that the natural will outperform the synthetic for a taker of liquidity. Of course the market-maker will earn more on the synthetic as he is adding liquidity at edge on two positions over one. So the bet is pointless and makes my point that this is a microstructure argument, not structural.

 

[nitro]

Quote from atticus:

It's not my bet, but let's assume that you're inside NBBO on your market. It's more than likely that the natural will outperform the synthetic for a taker of liquidity. Of course the market-maker will earn more on the synthetic as he is adding liquidity. So the bet is pointless and makes my point that this is a microstructure argument, not structural.

I am willing to do the trade at mid.

 

[atticus]

Quote from nitro:

I am willing to do the trade at mid.

What market? SPY?

 

[nitro]

Quote from atticus:

What market? SPY?

SPX

 

[atticus]

Quote from nitro:

SPX

We can't trade the box and make the bet, so how do you propose marking the synthetic to spot?

ES or SPY.

 

[Martinghoul]

Quote from atticus:

We can't trade the box and make the bet, so how do you propose marking the synthetic to spot?

SPY options and spot are fungible.

Hmmmm, I seem to have been shouldered aside in this mkt by experts...

At any rate, I was just about to mention bid/offer (argument didn't take it into account originally), but nitro is willing to do it at mid. Now just have to figure out how to do it...