Exchanges(CBOE)/IB - What is this trick?

While dialoging with nomoreoptions may be questionable, he does voice in an paranoid way what many of us feel at times trading options off the floor.

I for one appreciate your insights into why time and sales can look so odd for floor traded options.
 
Quote from ktm:

A while back, we all did the same thing. Then he proved beyond a doubt that he wasn't worth the time. Reality is not important to him.

There are always going to be people who put tin foil on the windows to keep the aliens from stealing their brain waves. You can talk to those folks all you like, but most of them still reboot at midnight.
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Wouldn't the aliens be capable of stealing the tin foil ...
 
Interesting insights. I don't like the original poster of this thread, BUT I was trading OEX options on expiration friday last month and became confused.

I was trying to sell my calls at 1.50 and had the order outstanding for a few minutes. I saw my order come up in TWS as the best offer.

A little while later the best bid went to 1.55 and I was still unfilled! I quickly cancelled my order for 1.50 and reentered it at 1.55. It immediately filled.

What I don't understand is how the heck that can happen, especially since these options are only traded at the CBOE.

Anyone want to take a stab at explaining this crossed market situation? thanks
 
Was your order being worked by a broker, or was it in the book ?? My only guess was that an actual broker was working the order, and what probably happened was someone else changed the quote. Unfortunately it happens all the time in the OEX and SPX. Generally, here's the scenario---

Your broker is on one side of the pit working the order, representing your 1.50 offer, let's just say the market is 1.20-1.50. On the other side of the pit, a broker quotes the same option, and the MM quote it 1.40-1.70 and instruct the quote reporter (an exchange official whose job it is to update quotes) to change the market to 1.40-1.70. While this is happening, your broker is busy working another order, and doesn't see that your offer is not being represented. Futures then move, and MM are now 1.55 bid before your order is executed. You cancel/replace your offer up to 1.55 (the current bid) and get filled instantly. If your order was being represented electronically, I have no idea how they could have increased the bid to 1.55 without you being filled at 1.50, so my guess is that your broker just didn't properly represent your order, and AMAZINGLY it worked to your advantage.:D

Vega
 
Quote from vega:

AMAZINGLY it worked to your advantage.:D

Vega
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Similar incident has occurred several weeks ago. I entered a BTC limit order @ 0.15 for an INTC option. The ask price then dropped to 0.1. I cancelled the order. Re-enter it @ 0.1 and was filled instantaneously.


:p :p :p
:D :D :D
 
Is it say to assume that your order was being worked by a live broker ? That's about the only scenario I can think of that would allow that to happen. I'm not familiar with a BTC order, is that similar to MOC ? The reason that I stated that both your and STOCKS orders were worked by live brokers is that if they were being represented electonically, the quote reporters would not have been able to change the offer to .10 while you were .15 bid, the exchanges system would not let them change the offer until your .15 bid had traded.

Vega
 
thanks for clarifying, never heard that before. Heard of GTC, MOC, OCO etc.. but never BTC. Only thing I was thinking it could've been was By The Close, but Buy To Close makes more sense I guess, although I don't know why that would be treated differently than just a BUY to close out a short position. Anyway, thanks for the definition.

Vega
 
Quote from vega:

Is it say to assume that your order was being worked by a live broker ? That's about the only scenario I can think of that would allow that to happen. I'm not familiar with a BTC order, is that similar to MOC ? The reason that I stated that both your and STOCKS orders were worked by live brokers is that if they were being represented electonically, the quote reporters would not have been able to change the offer to .10 while you were .15 bid, the exchanges system would not let them change the offer until your .15 bid had traded.

Vega
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Hi,

It was a Good-Until-Cancelled Buy-To-Close order. I am basically a premium seller, who try to take advantage of the time decay. Hence, I frequently enter BTC orders to close out option positions.


:p :p :p
:cool: :cool: :cool:
 
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