How to pull the rug on SPX market makers

[IB Kevin]

Quote from resinate:

I don't think this has been mentioned in this thread, and yes, going more electronic will be an interesting change for SPX. From the little I have read of the new system, its a bit different from the existing CBOE hybrid. IBs marketing of additional floor presence in light of hybrid's immanent deployment is curious.

When SPX goes 'index hybrid' on 9/25, there will still be only one electronic quoter, which rotates between 5 large market making firms, so spread width may not change much.

However, booked orders will be able to be traded electronically vs. the current system of floor brokers yelling to order book officials to manually match orders b/t buyer and seller. Therefore this change probably benefits small orders (<10 contracts) as they will trade much faster, and floor brokers will likely keep the larger orders unposted to look for price improvement.

 

[Strategery]

I was going to bring that up but didn't feel like trying to explain it to "Day Natenberg".

I got a call a while back from someone from the CBOE telling me that the SPX was going to be on Hybrd Light, and I thought it was already in production. We have a trader that plays between the S and the merc and he tells me that he has been getting a lot faster fills on his small SPX stuff lately. I just figured that they automated matching with the book.

 

[HedgefundTrader2]

Quote from IB Kevin:



However, booked orders will be able to be traded electronically vs. the current system of floor brokers yelling to order book officials to manually match orders b/t buyer and seller. Therefore this change probably benefits small orders (<10 contracts) as they will trade much faster, and floor brokers will likely keep the larger orders unposted to look for price improvement.

Floor brokers yelling at each other! LOL! In this modern day and age they don't have computers at CBOE? No wonder these sharks and gators are hungry with wide open mouths. Welcome to the green moat CBOE has dug.

 

[xflat2186]

Kevin,

Its not worth the effort on a thread like this. day is not interested in any facts he assumes, like many people in the vast anonymity of the Internet that his opinion is the only correct one and its a fact if he believes it. His "system" obviously is pointless since there is no obligation for a MM to back up a public bid or offer with more size.

Can you imagine if that were true? You could bid for a 1 lot and then sell 500 on your bid if the mm's had to honor it.

Kev... always good to hear from you my old friend I remember the good old days with Frau Blucher on the old currency floor

 

[cbkswonk]

So Gary- how'd you work out on those options this week? Get your spread clipped?

Gary - did you manage to shrink the SPX pit?

Us Theoretical rulebook reading guys want to know Mr. Mann


Thanks,
CBK

 

[HedgefundTrader2]

Quote from cbkswonk:

So Gary- how'd you work out on those options this week? Get your spread clipped?

Gary - did you manage to shrink the SPX pit?

Us Theoretical rulebook reading guys want to know Mr. Mann


Thanks,
CBK

I have been punching holes in those wide bid and asks all day. Bloodied some of your friends. They will go home " FLAT" shaking their heads what hit em.

They won't let me out of a put spread, I started sending ones and twos, pretty soon my basket was empty. Saved around $800 dollars on those wide bid and asks!

 

[cbkswonk]

Good.. get ready for Monday - you'll be paying up $800....


Thanks,
Blaine

 

[HedgefundTrader2]

Quote from xflat2186:

Kevin,

Its not worth the effort on a thread like this. day is not interested in any facts he assumes, like many people in the vast anonymity of the Internet that his opinion is the only correct one and its a fact if he believes it. His "system" obviously is pointless since there is no obligation for a MM to back up a public bid or offer with more size.

Can you imagine if that were true? You could bid for a 1 lot and then sell 500 on your bid if the mm's had to honor it.

Kev... always good to hear from you my old friend I remember the good old days with Frau Blucher on the old currency floor

Its not worth meddling with threads that you don't understand. You have no idea how SPX is traded so you won't know it at all.
Who cares if Market Maker is obligated or not. We force our desired BID and ASK and get our trades executed. I have been doing it all day today. Those bastards were taking it right or left.

I would suggest you consult a doctor, you seem a little bit unbalanced to me.

 

[cbkswonk]

Quote from day7793:

Its not worth meddling with threads that you don't understand. You have no idea how SPX is traded so you won't know it at all.
Who cares if Market Maker is obligated or not. We force our desired BID and ASK and get our trades executed. I have been doing it all day today. Those bastards were taking it right or left.

I would suggest you consult a doctor, you seem a little bit unbalanced to me.

Um.... I wouldn't say that about xflat ........ LOL

 

[HedgefundTrader2]

Quote from cbkswonk:

Good.. get ready for Monday - you'll be paying up $800....


Thanks,
Blaine

We will level some more contracts on SPX Monday. Losers will be singing the blues in that Castle wrapped around that green moat CBOE has built. You will not win this game with us. We are lot smarter than you are and greed doesn't pay at the end of the day.