When is options scalping manipulative trading?

arturo100 said:
It was mantioned a while ago on this forum that there was a daily maximum number of bids+offers a retailer could place. If I recall it corectly it was 1500.
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Recent postings say 390/day on average per month.
Can you check your number and post a link, maybe they mean different things.
 
earth_imperator said:
Recent postings say 390/day on average per month.
Can you check your number and post a link, maybe they mean different things.
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A retailer can place 390 orders a day and once they exceed that, they are considered professional and lose retail order priority. From my understanding.
 
earth_imperator said:
Recent postings say 390/day on average per month.
Can you check your number and post a link, maybe they mean different things.
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The 390 daily/monthly rule you mentioned exists for sure, but I remember, may be Robert Morse, talking about a limitation on a pure daily basis. I'll try to dig some of his posts.
 
arturo100 said:
It was mantioned a while ago on this forum that there was a daily maximum number of bids+offers a retailer could place. If I recall it corectly it was 1500. This is a rather big number and it would be likely unattainable using hand placed orders, which I guess is your case. Other than that it is difficult to understand what your broker is talking about.

However, the fact that you have to guess why you are guilty is disappointing. It also reinforces my idea that your broker could be your counterpart on some of these trades or at least have a strong interest on it. I understand that you are not willing to release its name, but probably for your operativity you should choose one which is not also a market maker or liquidity provider in the option market.
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I have never heard of the 1500 order rule. It is definitely not in the official CBOE language explaining the 390 order rule. It doesn't mean it doesn't exist - I have just not heard of it. Here is what I was told about the 390 rule. It is the average number of orders over a given month. There are 21 trading days in October. 21 * 390 = 8190. 8190 is the max orders we can place in October. When I was investigating this a long time ago with my broker (yes, they actually answered this question!), I was told that if you place 8190 orders on the first trading day of the month and no orders for the rest of the month, then your average is exactly 390 (not above it) and you would not get the professional option trader designation.

Indeed, I am still trying to "guess" why. This only happened on one underlying that I had only been trading for a short time. I am not sure how the broker being the counterpart or having a strong interest actually works. If that is the case, then it is definitely time for a different broker.
 
Gambit said:
A retailer can place 390 orders a day and once they exceed that, they are considered professional and lose retail order priority. From my understanding.
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Yes, 390 orders on average over the period of one trading month. If you go over, then you get the professional designation for an entire quarter.
 
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