https://www.cboe.com/products/contract-specs-and-trading-hours/extended-trading-hours
SPX options open at 3am EST
SPX vs SPY - your experience with trading them?
- Thread starter Abundance Magnet
- Start date
https://www.cboe.com/products/contract-specs-and-trading-hours/extended-trading-hours
SPX options open at 3am EST
Well you are right, but it does not help.
Can you and I (retail traders and I assume you are also retail) trade options at 3 AM?
This is how they describe the process:
https://www.cboe.com/framed/pdffram...X+and+VIX+Options+During+Global+Trading+Hours
AND
http://www.cboe.com/publish/tphforms/ethparticipantsfullsession.pdf
I am with Ameritrade and the first time I saw this, I tried it and I do not think you and I are allowed to trade 3 AM EST.
The only advantage is that I see prices getting updated before the market opens. However, it is fairly illiquid and as I read it - it is meant for institutions to trade during european hours.
I do not understand it fully based on the documents, and if someone is able to trade this before formal market open, please specify which broker so that I could try it out.
I have traded SPX options at 2 AM. The market may be illiquid but if you are able to get in to take advantage of the price gap at pre-market opening, it was really good. The only problem is you don't get a large no. of contracts to play with so you have to make sure the price is worth it.
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Robert Morse
Sponsor
The CBOE did expand SPX trading hours. Most brokers do not offer this before market trading because:
- Then they have to staff that time period with the ability to provide trade support and risk.
- Volume is very low vs ES Options during that time.
- Your trading software has to provide access. Most third party equity/index option software does not want to staff at that time.
Thanks ajacobson. So just to confirm I'm understanding correctly, "Virtu" whatever that is, will, at least if you have TD ameridrade, stand ready to buy and sell SPY, at least at some prices, 24/7? Have you used it? How good is it (in particular how big the spread)?
Thanks!
People in our shop have used it. All the products in non standard hours are pretty much the same - market quality is mixed and not terrible if the future is available - it's price discovery for pretty much everything S & P 500 related. Virtu for what it's worth is fairly size market maker and a notorious HFT trading firm, they are the folks who bought KCG after their financial challenges.
We don't use SPY much because SPX has no reporting requirement under 13F.
We don't use SPY much because SPX has no reporting requirement under 13F.
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I trade NDX and for the same delta and same risk, my perception (anecdotically) is that you get more premium. However NDX moves widely (it is basically controlled by 5 companies) and the juicy premiums you get just subsidize the price you pay for maalox [ I mean, it makes you work to earn those premiums. ]