How to pull the rug on SPX market makers

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Quote from MajorUrsa:

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Final question to OP troll: what was the purpose of you posting this thread, since you obviously don't want to discuss the subject.

Ursa..
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The purpose was to popularize a proprietary strategy, so it will level the playing field in the SPX options market to some extent. The more people know the better it is.

That was a crafted strategy, not some fluke.
 
Quote from Bob Rowshan:

With each new post you make, the troll day7739 wins. Don't you understand that? He's an idiot, and just looking to incite, and you keep falling for it.

And if you do trade the spx options, you know how idiotic what he said really is.
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Some people never learn. They are stupid to start with.

What I wrote I will be using Monday morning. I have been using this for a long time. Now you can too. I wish you the best.
 
Quote from day7793:

Quote from ChiBondKing:



ChiBondKing is the same person cbkswonk whose whole purpose in life seems to infiltrate this thread and destroy it.
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Wow - you do show some inductive reasoning skill! I'm impressed for a monday AM!

Now, if you would read carefully the previous post, I *DID* answer your question - unless you call answering your question with the facts and rules that govern SPX trading at the CBOE as "infiltrating and destroying" the thread - Your marbles are seriously misaligned.

Good luck.
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Quote from xflat2186:

The market does not have to fill other orders on the price of your order. If you split the bid offer spread and if that series trades on your price then you get your 1 or 2 lot.

If the market going in on a particular a call series you want to trade was 19 bid... offered at 23 and you bid 21 for a 2 lot the mm's are under NO obligation to fill any other orders at a price of 21. The beauty of that is that if another order for greater size comes in and is placed on the box, say an order to pay 20 for a 50 lot, your 21 bid for 2 actually protects that order since now no one else but the pit can see that 50 lot bid and when the futures move down to the appropriate price they will simply sell your 2 lot at 21 and then sell all 50 at 20 immediately so long as the futures fall to a price where they feel there is sufficient edge as to buy the futures and sell that 50 lot at 20. If the futures move up they won’t bother filling your 2 lot nor would they be interested in selling the 50 lot at 20 bucks. But it gets even better, if other orders in nearby strikes come in and they end up buying options from those other orders they always have both your 2 lot and the hidden 50 lot to lean on in order to sell them at a higher volatility level then they just paid in a different strike.

In essence the 1 and 2 lots are helpful in allowing the pit to lean on any other orders that might be out there. The beauty of the “out back” or the large collection of mm’s who only trade 10 up is that they keep the bigger greedy mm’s from leaning too long on those hidden gems like the rare 50 lot that might be put on the box. The 10 lot crew is more willing to trade the 1 and 2 lots for a lesser amount of edge then the big firms.

Of course almost all the of the size order flow, say 25 lots and higher don’t get put on the box and they’re held orders by floor brokers. Also, few of them are retail orders and only retail orders have standing in the pit. So all the off floor orders that come from prop houses and institutions have no standing don’t get put on the box for all to see and contracts can trade all day long on their price and they don’t have to be filled. Then again most of that order flow is shopped to other prop firms and other off floor liquidity providers before those orders ever hit the pit. Then the floor broker simply walks into the pit and since he now has both the buy and sell side of the order he crosses it at a pre agreed upon price and he may dish some off to the mm’s to keep them happy.

It all has a place in the market and unfortunately in a product like the SPX since its aimed at the institutions not the retail guy, that little 1, 2 and 3 lot retail guy gets screwed.
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I am just reposting some FACTS that I did earlier so no n00b that stumbles across this thread is confused by incorrect opinions that one individual posted.

Have a nice day :-)
 
Quote from xflat2186:

I am just reposting some FACTS that I did earlier so no n00b that stumbles across this thread is confused by incorrect opinions that one individual posted.

Have a nice day :-)
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You have done that twice.

Thank you and Goodbye.
 
I just went through 35 pages of garbage with about 5% very useful info. I wonder if all of the 100% of the time and efforts put into this thread had been pointed towards productive goals how much more the audience would have benefited from this thread.

Day has a point, he has just discovered a new approach to him that is not so new to others, so let it be, throw in your 2 cents and let the others benefit from your knowledge, ignore his insults and does not matter if he wants to understand it or not. The objective should not be correcting one person's mind and thinking rather allowing many others to benefit from your know how, as I have from several posters here even including Day.

Now, can this discussion be continued talking about electronic options, their pros & cons, which would be the best candidate for ES and why?
No insults please, try to exercise tolerance even for those who lack it.

thanks
 
Quote from Cy_M:

Now, can this discussion be continued talking about electronic options, their pros & cons, which would be the best candidate for ES and why?
No insults please, try to exercise tolerance even for those who lack it.
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Good point and I tried to do just that. But the fact is that the man made a very untrue and misleading comment on the obligations of the MM. I think if someone is helpfull and tries to point how reality works and then gets told to fo, there is a logical necessity to put this guy in his place.

I am all for open and respectful discussion as you may know, but it is types like him that make this very hard to do on this forum and on the internet in general. No way you can get a fruitful thread if the originator tells all commentators to shut up and closes his ears to the actual content.

Ursa..
 
Ursa,
I have read your posts and indeed they were informative.

This thread as well as all the rest of the threads are public and belong as much to every user as the author.

I am sure, Day is also ready to put aside hostility and understand that some agree with his view and some not. So fine let it be.

I have not traded options since a couple of decades ago, I used to back then trade OEX because they were the only ones that were electronically displayed at the time.
I am now 100% into just ES but do intend to defiantly mix it with options again since together they provide a lot more opportunities.

Back then I remember the options were a lot more volatile and their premiums jumped a lot more than it should for a few seconds when there was a rapid move in the index and that is what I want to take advantage of now if it still exists which I believe it should, the market psychology never changes.
What I need to know is which Option would be fully electronically traded and be correlated to ES and most importantly have a tight spread and lots of liquidity?
I looked at Es but didn't like the liquidity at all!
From what I learned from this same thread was that SPX and OEX should both now be traded electronically? if so which is the best candidate for my purpose?

thanks
 
r
Quote from MajorUrsa:

Good point and I tried to do just that. But the fact is that the man made a very untrue and misleading comment on the obligations of the MM. I think if someone is helpfull and tries to point how reality works and then gets told to fo, there is a logical necessity to put this guy in his place.

I am all for open and respectful discussion as you may know, but it is types like him that make this very hard to do on this forum and on the internet in general. No way you can get a fruitful thread if the originator tells all commentators to shut up and closes his ears to the actual content.

Ursa..
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Respect comes from giving respect.

When you are trying to "put someone in his place" you better face the consequences. I am not your pushover garden variety kid.

You have admitted you have never traded SPX, your knowledge is zilch about SPX, what do I have to deal with you for ? On top of that you are riding a horse with a big name and trying to barrel your way in, as if I am obligated to be put in my place.

I told you go away. Is that hard to understand?

Go away. No dice.
 
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