Options Commissions

[ForexForex]

Quote from spindr0:

I agree. If you NEED to execute because price is moving against you, you have to execute at market prices. But if you are working an order, better fills can add up to an awful lot over the course of a year. Obtaining a mere nickel on each side of a 10 contract spread once a week is 5 grand a year. Saving more than a nickel and/or doing size is a whole lot more. All I'm saying is blindly placing market orders for every position is not a good idea.

FWIW, regarding iron condors, I've seen component combos trade 10 or more cts cheaper one entry way versus another. IOW, market the market price for two verticals might be less than that of two strangles (or vice versa). So even just looking at a different combo would have saved a chunk over a blind market order.

To get the $5,000 discount you are assuming all the LIMIT orders get filled and that any MARKET orders would have been filled at an inferior price. This would not be the case.

In reality you would end up with a lot of LIMIT orders that need modification and perhaps filled at a much worst price than if a MARKET order was used originally. And if your stubborn enough maybe even have the order go unfilled.

Quote from MTE:

Using a market order is asking for trouble! If you really want to get in/out then you should use a marketable limit order - i.e. if you are looking to buy an option, which is 1.90 offered then you should use a limit order with a 1.90 limit. This way you would get filled @ market without the risk of getting huge slippage.

Don't forget that a market order = execute at any price!

Do you have any real life examples of someone getting into trouble with an Interactive Broker MARKET order, any ET threads on this?

 

[spindr0]

Quote from ForexForex:

To get the $5,000 discount you are assuming all the LIMIT orders get filled and that any MARKET orders would have been filled at an inferior price. This would not be the case.

With logic like that, it's tough to compete

Over the years many here have posted that their spread orders on the SPX tend to be filled near the midpoint. Given that SPX option spreads are very wide, for an active trader, just placing a spread order with get you more than that "discount".

Your advice is tantamount to saying, never place a spread order because you might miss a position. But my favorite reason for doing a market order is your previous statement that:

Another big plus is that you get the trade over with and can do something else.

Yep, that sounds like a real dedicated money making endeavor.

 

[ForexForex]

"Another big plus is that you get the trade over with and can do something else."

Quote from spindr0:

Yep, that sounds like a real dedicated money making endeavor.

And chasing a LIMIT order until it gets filled is a money losing endeavor and time waster. I don't consider watching the monitor for an order to get filled very productive.