SPX Credit Spread Trader

your getting some amazing fills...I do need to start calling the help desk...I just have phone phobia :(


Quote from rdemyan:

Got the following trade filled today:

DEC SPX 1120/1135 bull put spread at $0.70

Got ToS to 'goose' the trade. I was right up against the mid (about $0.025 below) and they came through again for me.

I love these guys!:)
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I tell you, the difference between OX and ToS with regards to getting these fills is night and day. Because ToS gave me the same commission rate as OX, I'm making money (because of the better fills).

The guys at the trade desk routinely tell me to call for help, so I don't think you need to feel shy. I know they can seem a bit intimidating as they're all ex-traders and have the strong personality types. Today, for example, when I called the trade desk, the guy was a bit hesitant because the midpoint was vacillating between my limit and $0.025 above or below. But I didn't say don't do it, I'll put in a more 'reasonable' bid (reasonable from the MM's point of view). I just asked him to call down, and he did. Within 2 minutes, the trade was executed. For me, the better fills typically amount to $50 to $100 of extra credit (which these days isn't chump change). Of course, you have to be somewhat reasonable. But I've been getting my trades filled at midpoint or very slightly below.

You're a good, knowledgable trader. Just ask them to call down to the floor and I'm sure they will. Once you start getting filled where you think you should, you won't accept anything different. :)



Quote from DonnaV:

your getting some amazing fills...I do need to start calling the help desk...I just have phone phobia :(
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I had been getting pretty good fills with OX until the last 2 weeks. I looked up the number for their trading desk today and will be trying that out next week to see how it goes.

ryan


Quote from rdemyan:

I tell you, the difference between OX and ToS with regards to getting these fills is night and day.
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Donna,

If you're with ToS you can also use the live support feature for getting fills if you're more comfortable typing rather than phoning.

Momoney.


Quote from DonnaV:

your getting some amazing fills...I do need to start calling the help desk...I just have phone phobia :(
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For those that don't know, ToS also support commission structures from several other brokerages if you are switching from them e.g. Ameritrade, E*Trade etc.

https://www.thinkorswim.com/tos/client/products/rates/rateplans.jsp


In addition to at least three of their own commission schedules. The standard one and these two:

https://www.thinkorswim.com/tos/client/products/rates/rateplans.jsp

Naturally it's quite straightforward to look at your past activity and do the math to work out which one is best for you.


Momoney.


Quote from rdemyan:

I tell you, the difference between OX and ToS with regards to getting these fills is night and day. Because ToS gave me the same commission rate as OX, I'm making money (because of the better fills).
More...
 
My 2 cents:

The thing is, if you are good enough to pick direction for legging in to spreads then why bother spreading at all? Why not go for maximum leverage.

You are effectively changing your direction sentiment by legging into the spread. When you go long OTM calls your sentiment is bullish and when you complete the credit spread your sentiment becomes bearish. Similarly, time decay is against you and you want volatility to increase when you are long OTM singles but then the reverse becomes true once you credit spread OTM.

Are you a speculator or a spreader? To an outsider, the behavior might look a little schizophrenic.

Now this might be exactly what you want to do: change to a spreader when market conditions have changed and I can see why you might want to take this approach in this particular month when everyone is virtually wanting to guarantee that it will be an up month. So be it.

However, in GENERAL, I would take the bet that you can't get better credit spread positions by legging into the spreads by playing the bumps and dips i.e. I think you would come out worse as many times as you come out better.

If you prove me wrong, I'll pay to subscribe to your newsletter/trade alert service!

At the end of the day, there's only one way to find out - try it. If you don't give up trying pretty quickly: I'll eat my hat.

I'm off to buy a hat.

Momoney.


Quote from rdemyan:

Coach:

What about initiating the spread positions a little differently. Place the long position first, wait to see how the market moves and then let it ride if it goes your way or adjust to a credit spread.

I guess if the market moves against you, you could adjust to a credit spread at a lower overall credit (compared to if you had done this when the long was first placed). But the bigger issue might be tying up significant margin in a credit spread that produced very little credit (or perhaps even a debit, if the market moved strongly against the initial long).

Still, I wonder if people use this type of strategy.
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Donna,

I'm with you. It seems that TOS should work to get all its ordered filled at optimum prices without a nagging phone call. It reminds me of the kids that used to go and see the teacher whenever grades came out. "Teacher, Teacher, I deserve a better grade!"

But it just goes to show that the squeaky wheel gets the grease!

Of course if this is the way TOS is, or other brokers for that matter it will just encourage all its patrons to call and whine incessantly.

Cody
 
This whole series of comments is interesting. Go back in the chain, and you'll find comments that OX had better fills than TOS. Many people complained to TOS (me included). They seemed responsive.

Unfortunately, it all comes down to the vagaries of these pit traded securities. Just wish it were'nt so!
 
It really has nothing to do with the squeaky wheel at all. You see a bid/ask spread and place a limit order and it is sent to the floor like all other orders. A broker mainly passes on your order and has no control over prices. However, the SPX is a pit traded option and to get a better fill it sometimes takes someone pushing on the floor with the market makers to find which ones are willing to pay or sell at the price you want. For $1.25 a contract, you cannot expect ToS to do this with everyone. However, if you trade enough ToS is more than willing to help you where they can get a better fill.

Just my opinion but it is not whining really but working to get the best fill on an option which is pit traded and has a lot of different market markers.

Phil


Quote from codyhopkins:

Donna,

I'm with you. It seems that TOS should work to get all its ordered filled at optimum prices without a nagging phone call. It reminds me of the kids that used to go and see the teacher whenever grades came out. "Teacher, Teacher, I deserve a better grade!"

But it just goes to show that the squeaky wheel gets the grease!

Of course if this is the way TOS is, or other brokers for that matter it will just encourage all its patrons to call and whine incessantly.

Cody
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