RFQs for Futures Options Essential or not ?

B

Bizmark

Hi guys,

Looking to trade Futures Options: Eurodollars, Treasurys, Crude, Currencies, Metals, and Ags; in decreasing order of interest.

For strategies, mainly selling premium condors, butterfly, call spreads, put spreads, straddle, stangle; is it absolutely essential to have RFQ functionality to get good prices off, especially in Eurodollars ? CQG/TT/CTS/CME-Direct/Optioncity/ all have this options rfq functionality but want to make sure it is something I will need ahead of incurring the fees to start, or if a simple Tasty Trade / IB could work.

The spreads are relatively wide, the strike selection is as well, the execution is maybe 50% of the profit on a Eurodollar fly (in single month expirey) for example.

Anyone with experience with options on futures, particularly Eurodollar, please let me know do you Leg, RFQ, or just submit order to strat board...how you getting the right fills?
 
Was asking about options on futures rfq function, not sure I understand answer, are you saying this works for options on ZB/ZN/ZF... ?
 
other than for trading,
the price of OTM options for commodity and some index futures is like 5% of the underlying security.
I don't see the point of buying them and the lack of volume shows why. very few people participate in those
options. as a hedge or speculation.
these options listing is for the option 'players'
 
Beatles, I get what you are saying...however consider selling premium, for example, in a 50bps wide iron fly option strat on eurodollar futures. The liquidity is quoted very close to the money, bid/ask matters with each tick @ $25 and the strike selection is gapped wide. So begs the question, are people who trade this legging/rfq-ing ? How they getting on ?
 
Bizmark said:
Was asking about options on futures rfq function, not sure I understand answer, are you saying this works for options on ZB/ZN/ZF... ?
More...

Yes, option on ZB future. Should get filled at the mid price using IB strategy builder on a credit spread.
 
There are enough MMs (and "market-takers") in the Euros to probably make you a pretty tight (maybe even "choice") market in response to your RFQs if you are going to trade small (500 or less). To your advantage, ED traders may go out of their way to take you out of your orders at "mid-market", just so it doesn't clutter up their RFQ Viewer/Screen.
 
VolSkewTrader said:
There are enough MMs (and "market-takers") in the Euros to probably make you a pretty tight (maybe even "choice") market in response to your RFQs if you are going to trade small (500 or less). To your advantage, ED traders may go out of their way to take you out of your orders at "mid-market", just so it doesn't clutter up their RFQ Viewer/Screen.
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Why would they do him the favour? So he doesn't scew the bid/ask down/up?
 
Atikon said:
Why would they do him the favour? So he doesn't scew the bid/ask down/up?
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Sort of. The Eurodollar options are dominated by big prop groups with deep pockets. They are so laser focused on doing the big institutional trades, that they'll just take out the pesky small retail orders that are "middling" the markets, so the really big customers can see where (hard bid/hard offer) they can get size off at one price.The ED traders don't want the big NY/London desks thinking they can execute their really big orders where the little mid-market retail order is resting.

The SPX guys aren't as accommodating.
 
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