SPX 500 Liquidity

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CBC

Hi guys,

I'v been trading options here is AUZ for a while now and due to the current market I've decided to look to the US for new pasture. Here is AUZ we have the S&P ASX 200 which have options however you cant really go outside the top 20 without been meet with serious liquidity problems.

I know in the US that you guys have a much much bigger market, however before I try entering the SPX 500 members into my IB watchlists for serious analysis. I was wondering if I should only stick with, say the top 200 members.

Thanks for your answers is advanced, it shall save me a lot of time. I would be looking to use $5k on a contract with max $10k per underlying.

Thanks.
 
ES the most used idex for the trading you describe encompasses all 500 stocks. I can assure you the liquidity is second to none. During RTH it is one of the most liquid markets in the world.
 
Hey Swan, Ty for the reply however I don't think I asked the question properly,

I wanted to know out of the top 500 us stocks, which ones I could trade options on.

http://en.wikipedia.org/wiki/List_of_S&P_500_companies

Out of these companies, will I get met with any liquidity problems?

I'm aware of the S&P 500 index options however I was looking for stock options.


So is it the top 100, 200?

I just wanted to know cauz I know nothing about the US. I didn't want to spend a whole day putting 500 stocks into my IB watchlists if I wasn't going to use them all.

Ty
 
Quote from newwurldmn:

Over 400 names will be liquid enough for the most demanding retail account.
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Thanks m8,

long day ahead......
 
Take the S&P 500 stock list and sort by average daily volume. Generally the daily volume of the stock correlates with its option liquidity. Of course most of the S&P 500 stocks are heavy hitters anyway.

Depending on what option strategies you're looking at, you might also want to filter for higher priced stocks.

I just filtered for optionable stocks with average volume > 1M and price > $30 and got 308 out of 500 (not all stocks in the S&P 500 are optionable)
 
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