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"Options market pricing in a X% move on the stock"
- Thread starter a529612
- Start date
Quote from spindr0:
How do you differentiate the speculative buyer of 10K calls at the ask from the hedge fund buying 10K calls at the ask to protect 1 million short shares ??
It doesn't matter because the two buyers have the same objective . Making money is equivalent to losing less money.
John
Yeah, there is an "application" , also... But when I signed up for the regular insideoptions subscription, I was given a free trial to the blog, no forms or other junk to fill out. Also, he gave away a free trial to optionmonster members (membership is free) a few months back.
you have no clue how options work, the buyer could have a volatility play and the seller could have a directional play on. They both could make money with their options.Quote from jficquette:
It doesn't matter because the two buyers have the same objective . Making money is equivalent to losing less money.
John
"He says that he will not take just anyone into this service, implying that he has to turn people away.
Hmmm......"
Hmmm indeed!! Somehow, I don't see him turning away clients willing to throw cash at him.
However, if you're stupid enough to throw cash at a guy who shows up on tv wearing THREE TRADING BADGES (CME, CBOT, CBOE) AT THE SAME TIME, then you deserve what you get.
Caveat Emptor!!
Hmmm......"
Hmmm indeed!! Somehow, I don't see him turning away clients willing to throw cash at him.
However, if you're stupid enough to throw cash at a guy who shows up on tv wearing THREE TRADING BADGES (CME, CBOT, CBOE) AT THE SAME TIME, then you deserve what you get.
Caveat Emptor!!
You have no clue what John means. He compares two buyers, you compare a buyer and a seller. And he is right: from bearish to neutral = from neutral to bullish.Quote from cvds16:
you have no clue how options work, the buyer could have a volatility play and the seller could have a directional play on. They both could make money with their options.
Quote from MTE:
As I said in my post, if you see the order flow then that's a different story because then you can see whether the intiator was bidding or offering. This is NOT the same as looking at the total put/call volume and then trying to make sense out of it.
In order to get some meaningful information, wouldn't be sufficient to see how the open interest changes?
Open interest doesn't say whether it was bought on the offer or sold on the bid.
Quote from thegazelle:
Open interest doesn't say whether it was bought on the offer or sold on the bid.
Correct. But the open interest tells you the amount of new positions being opened on that option, i.e., an increase of the open interest on a call tells you that there is an increase of long positions on that derivative and viceversa.
Quote from arturo3:
Correct. But the open interest tells you the amount of new positions being opened on that option, i.e., an increase of the open interest on a call tells you that there is an increase of long positions on that derivative and viceversa.
In that case, is it effective to compare open interest (buys) vs volume-open interest (sells), instead of the P-C ratio?