This is indeed a ticker to avoid:
(*) hardly any open interest on both call and put options.
(*) almost no trading volume on both call and put options.
(*) very large bid/ask spread compared to the price of the options contract.
New guy and the new math ....
- Thread starter wburt1948
- Start date
(*) hardly any open interest on both call and put options.
(*) almost no trading volume on both call and put options.
(*) very large bid/ask spread compared to the price of the options contract.
I don't think there's a "best"; it's whatever mix of features suits you best (and whatever annoyances you can tolerate.) E.g., TradeStation has really great charting, indicators, a language of its own, and reasonably decent fills... but also has sucky tech support/poorly-informed trade desk staff and abysmal software quality, so crashes and freeze-ups are common. TastyWorks has a really good user interface, good fills, seriously competent support, and I've never seen it crash - but you can't do chart-based trading (assuming that's important to you; to me, it's not.)
If I was starting over, I'd probably stick with TastyWorks for options and futures. I also have OANDA's MetaTrader for FX trading, and like it quite a bit.
the midmarket didn't change because:
1. the spread is really wide (20% of the underlying)
2. the vol is really high (making a 2% move in the underlying irrelevant)
if you had a theoretical model, you would see a modest change in the fair value, but these variables would dwarf that change.
How wide? .... Dunno, didn't consider it. Dazed and confused. Now I know better.
Market or limit? Limit at mid-point
Thanks for your help. This forum certainly has good people willing to assist/mentor. My job is now to not screw myself with stupid trades again.
Interactive Brokers and ThinkorSwim, are the ones I've used and both are good. Tradestation I've heard is good, but never used it. Each has different requirements for opening an account that can trade options. They won't give you a hard time if you just buy but for selling they are more strict. You might be asked some questions to make sure you know the basics in options.
After reading all of your posts on this thread, I get a sense you don't understand how options are generally priced?
The prices of calls/puts are a function of the following parameters: Underlying, strike price, time to expiration, risk free interest rate, dividend rate and vol (volatility of the underlying). If you haven't already done so, go online, google option pricing and read up on it (or buy a book). Once you have a general idea, I suggest you buy a good option book and read.
The best advice is from @destriero: Don't trade option with underlying < $5 and triple digit vol.
As newbies (I am one myself), we don't stand a chance if we don't arm ourselves. You are a Navy Vet, you understand your chance going into sea battle in a small row boat against a DDG or a Ticonderoga? The option trading business is highly competitive don't expect your counter party to hand you some free money.
Good luck.
If you are really serious, buy and read either McMillan or Hull.