Hi, I am going to test a options trading strategy. Just wondering what stocks have lower bid-ask spead than others. I know QQQQ and SPY index options have the lowest spreads. Any other indexes and stocks? Thanks.
If you're into common shares, I would check the CBOE's list of penny-traded optons, they should have much narrower spreads than the nickel-traded ones. Personally, I would happily give up a nickel in bid/ask if it meant playing a stock I felt I could more reliably predict. Get the cake before you worry about the icing.
Apart from penny spread programs, any DOW or top 100 S&P stocks should have tight b/a spreads of $0.05 on average. Of course stocks like GOOG with higher relative prices will have spreads of perhaps $0.10 but it is still pretty tight.