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  • datbehardwork datbehardwork Jul 13, 2007 1:51 PM Flag

    I would have thought we'd be...

    Just put a bid in on Jan 30 puts, see if they execute!

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    • Dat, friendly tip, if you do not already know.

      I was not using "directed trading" for options until an ex-CBOE trader told me to start doing it. I was complaining to him that many of my orders did not fill although I would see activity at the price. He explained that many houses get rebates for order flow, so they direct their order to that exchange. Even though the order may get transmitted to the other five option exchanges, if they fill it they have to pay a fee of some sort to the referring exchange. Conseqently your order can sit.

      To make this more poignant, let's say you use Fidelity and they have a deal with the BOX. So your order goes to them. But they may trade only 2% of the options volume in that issue. Your order gets posted out to all of the exchanges but because of the fee and rebate structure it could sit.

      What to do? First you must go to the OCC (Options Clearing Corp) website at: www.optionsclearing.com
      Click on "Volume Query"
      Type in the stock symbol and the indicator for the vol for the past week or month.
      A screen will appear with the number of contracts executued by exchange and the % of the total.
      Pick the highest or second highest % and use a "directed" order system to direct you order to that exchange.

      Your fill % will go up dramtically.

      Hope this helps you or someone else.

      Last week's split on RSH was:

      PHLX 52%
      ISE 26%
      CBOE 8%
      AMEX 7%
      BOX 3%
      PCX 2%