Simple and Complex Option Spread Trading

R

RedSkyS

1. Is there a desire for customers to easily and electronically trade complex option strategies (straddles, strangles, call spreads, time spreads, etc.)?

2. Have the exchanges and brokers been neglecting this segment?

3. What features would you want in such a system?
 
RedSkyS,

As someone who works for a well-known ISV, I'll tell you that there's a huge outcry from the professional options trading community to be able to execute complex spreads through one click electronically.

Whoever figures out the logic of being able to send a complex strategy order properly tagged and legged will have a lot of guys beating a path to their door.
 
Very difficult to implement. Suppose your iron fly displays the ISE as best offer on your wing combo; with the AMEX as best bid on the body-put, CBOE as best bid on the body-call. It's a crap-shoot of receiving a simultaneous electronic fill involving multiple equity exchanges.

You can build killer software, but the exchanges remain the weak link.
 
Quote from riskarb:

Very difficult to implement. Suppose your iron fly displays the ISE as best offer on your wing combo; with the AMEX as best bid on the body-put, CBOE as best bid on the body-call. It's a crap-shoot of receiving a simultaneous electronic fill involving multiple equity exchanges.

You can build killer software, but the exchanges remain the weak link.
More...


Exactly, probably not to difficult to implement for just one individual exchange. But then your stuck with one DPM's quote for that spread. Who wants that. Better to shop your complex orders, ( or leg if your good at it)
 
Does anybody know of good option software that allows sweeping from multiple exchanges?

Quote from Nordic:

Exactly, probably not to difficult to implement for just one individual exchange. But then your stuck with one DPM's quote for that spread. Who wants that. Better to shop your complex orders, ( or leg if your good at it)
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We have a internal proprietary app here on our desk here at the inv. bank that does single stock options as well as complex options. Can't say more than that (for obvious reasons)

Also, I believe ISE offers ClickTrade which has support for complex option strategies. But, you gotta jump through the ISE hoops. Don't think it's the avg retail piece..


Doesn't CyberTrader also offer a complex option trading platform as well? I remember one of my friends who showed it to me sometime last year.

c
 
Quote from riskarb:

Very difficult to implement. Suppose your iron fly displays the ISE as best offer on your wing combo; with the AMEX as best bid on the body-put, CBOE as best bid on the body-call. It's a crap-shoot of receiving a simultaneous electronic fill involving multiple equity exchanges.

You can build killer software, but the exchanges remain the weak link.
More...
From what I have seen, ISE and BOX will accept the strategy.

Our internal platform, we can construct the strategy and we have 1 of 2 choices:

1) Manually work each leg, routing to the regionals for execution (whoever's going to give us the best price for that particular leg). We assume the risk of falling within the net/strategy parameters.

2) Route it to ISE (I believe we're signing an agreement with BOX sometime this year to support routing the entire strategy) and let ISE automatically try to execute the strategy and keep it within the net/strategy price parameters.

AMEX, CBOE, Philly, Pacific... no way in hell.. LOL :D
 
Quote from ChiBondKing:

From what I have seen, ISE and BOX will accept the strategy.
More...

IB offers complex spreads/combos intra-exchange through ISE and inter-exchange as well.
 
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