Lately I have noticed that the spread between the bid and the ask on some options have been unusually wide .. i.e 20 30 and 40 cents or more e.g the shld june 18 call has a bid of .39 and an ask of .70
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Has anyone else noticed that options spreads ...
- Thread starter unclebond555
- Start date
Quote from unclebond555:
Lately I have noticed that the spread between the bid and the ask on some options have been unusually wide .. i.e 20 30 and 40 cents or more e.g the shld june 18 call has a bid of .39 and an ask of .70
As volatility increases the bid ask spread widens, also as the weekend approaches they widen too. To answer your question if you bought at .70 you would immediately be down and have to wait on a move up in shld to get to breakeven. Looking at a time and sales log will give you a more accurate picture of where that option is trading.
Quote from thkang:
there is a sucker or there is someone disguised as a sucker, waiting for the real sucker to dive in. So either way there is a sucker...
Quote from 76132:
You don't mind explaining? Let's say I'm a sucker and a buy at $0.70. What happens?
You would only get a +400% return, todays range is $4.50 to $5.10
http://finance.yahoo.com/q?s=SHLD110618C00070000
Some sucker actually paid $0.90 yesterday, what a fool.
Wow that June 70 Call is now
Bid 4.70
Ask 5.15
Bid 4.70
Ask 5.15
I've seen some wild swings on TOS. For example on an option spread, the p/l graph might be positive,then the next day at the beginning , hugely negative because the spread is so wide, then when bidders finally come in by midday, the p/l graph is back to "normal" expected considering day to day reasonably trending movement, not gapping all over the place like some commodities.
Quote from unclebond555:
Lately I have noticed that the spread between the bid and the ask on some options have been unusually wide .. i.e 20 30 and 40 cents or more e.g the shld june 18 call has a bid of .39 and an ask of .70
I haven't noticed wider spreads. I did notice, however, that it's got a lot harder to get filled close to the mid, i.e. you really need to give up a lot of edge if you wanna get filled.