SSF Volume?

[esc_trader]

There is just no reason to trade SSFs. Given the amount of leverage, tax treatment, and costs comparable to stocks - why pay .03 more for an SSF when you can just buy the stock. Not many takers.

Also, for the market to be active, someone has to be in there willing to take some risk. The MMs are not doing so, since it is a layup for them to just hedge vs the stock with an automated program.

They need to get traders in there, not just the MMs. They should,

1. Liquidity Rebates. Worked for the ECNs.
2. Push to try to get better leverage/lower margin for traders.
Helps make the eminis popular.
3. Lower the commission rates. IB won't like this idea, but futures rates have gotten really low ($3.30/rt for the minis!). When you can do several round trips for the cost of one tick, that makes for a pretty compelling product.
(If you don't like that idea, then just make the contracts 1000 shares instead of 100, like that QQQ that IB won't even list for its non-institutional customers!)

 

[def]

Quote from esc_trader:

3. Lower the commission rates. IB won't like this idea, but futures rates have gotten really low ($3.30/rt for the minis!). When you can do several round trips for the cost of one tick, that makes for a pretty compelling product.
(If you don't like that idea, then just make the contracts 1000 shares instead of 100, like that QQQ that IB won't even list for its non-institutional customers!)

IB charges $1 for a SSF's.

There are benefits.
- shorting on a down tick
- overnight margin of 5:1
- better use of capital and cheaper financing for longer term players.
- No PDT rule
- overseas there are bigger benefits - namely no stamp tax.

With that said, you are right. While market makers provide liquidity - always nice to know you can get out for a few tick - in general MM's don't don't have a large appetite for risk and prefer to remain delta neutral. Thus you need the committment of a number of market makers who end up tightening the spreads amongst themselves or a bunch of traders willing to tighten the spreads. In the US the stock exchanges provide excellent liquidity so it isn't a surprise to see them off to a relatively slow start. The SSF's do serve a purpose for a certain class of individuals and over time, they may end up doing well.

 

[randyhorse]

Quote from def:



IB charges $1 for a SSF's.

There are benefits.
- shorting on a down tick
- overnight margin of 5:1
- better use of capital and cheaper financing for longer term players.
- No PDT rule
- overseas there are bigger benefits - namely no stamp tax.

With that said, you are right. While market makers provide liquidity - always nice to know you can get out for a few tick - in general MM's don't don't have a large appetite for risk and prefer to remain delta neutral. Thus you need the committment of a number of market makers who end up tightening the spreads amongst themselves or a bunch of traders willing to tighten the spreads. In the US the stock exchanges provide excellent liquidity so it isn't a surprise to see them off to a relatively slow start. The SSF's do serve a purpose for a certain class of individuals and over time, they may end up doing well.

How do you trade these POS? Freakin exchange goes down you're F'ked ! It's down right now. And no F'kin VOLUME! WTF!!

 

[randyhorse]

The spread sucks big time. $.10 down right from start (.05 buy, .05 sell). F'k! How can anyone make $$ on these POS! WTF!!

 

[randyhorse]

PS SHORTING DOWN TICK? BFD! THEY SCREW YA A NICKLE EACH WAY! WTF!

 

[super-ego]

Any idea what record volume in any one contract is?

 

[Kicking]

Today was the last time I traded this POS. It did not open until 9:34pm (it is supposed to open at 9:15) with a 15 cent spread, nobody traded with me in the subsequent minute when I was offering in between the spread. I took it off my screen ...

 

[50 cent]

SSF are a bad joke and many people wonder if they won't be a thing of the past real soon. They probably will. They should. The future lies with Globex imho.