Bobl and Schatz options

Discussion in 'Index Futures' started by qazwsxedc, Feb 6, 2004.

  1. Just trying out a few things selling Bobl and Schatz options, and I'm having a hard time getting filled.


    The bid-ask spread in Mar strike 106.2 Schatz calls is 0.03, I make the best ask. Nobody bites. The only trades that go through the market are volatility trades, recognizable by the nice large round volume figures. Nobody appears to be trading outright options or option spreads. The only non-vol trade this morning was some poor guy paying full ask for some March puts - on a 9-tick spread for 250 contracts. Ouch.

    Is this normal ?
  2. It is normal.................for the novice. Wisdom doesnt come cheap and frankly neither does the shatz at the prices you seem to be offering. You seem to lack discipline and your seeming inability to grasp the simple concept of good queage will not stand you in good stead to be sucessful at trading. The key here is to set achievable goals at a standard you can cope with.

    Good Luck

    may the shatz be with you
  3. sjp


    So, nobody bites eh? I'll be honest with you, I am not surprised. Your methods seem sloppy at best, and the brazen way in which you all but admit to having absolutely no trading plan does you no credit.

    If a price is good - and meets the criteria of your plan - then be prepared to go to market to get filled. If not then become a shephard or sit in your room and work on your music.

    I fear for your future in this game.

  4. Hm. I must say I'm a little surprised at the open hostility here. Perhaps I missed something when phrasing my original message. I do have a plan in the sense that I formed a view of the market WRT near-term volatility and direction, and I'm trading based on that. I also have a plan for when and how to get out if it turns out my view is wrong.

    More to the point though, I got filled a little while ago on one of my offers. Three ticks better than the lowest bid in today's market, and still better than present bid, even after the payroll figures. It just surprised me that it took so long (literally hours), that's why I asked.

    Should I really have gone to market and given the extra three ticks to a market maker ? Is not doing that why I'm getting my head bitten off here ;-) ?
  5. sjp


    3 ticks today, nothing tommorow. Down your path of trading lies the town of Skint. It was certainly not my intention to be hostile, although clearly the other contributor intended to offend you.

    Are you really that surprised that such a shallow trading strategy as yours excites such responses from other, more developed, traders? Perhaps it is worth re-reading the entries above and seeing whether there is any merit in the suggestion that you have some serious fundamental flaws in your trading style.

    Sir, I pity you

  6. I think I get it now. You think that I looked at some quotes, said, "OK, these look good, let's undercut them by a tick and see what happens."

    I wasn't quite as slapdash as that. Nor as much of a n00b (or so I'd like to think, but I'm sure someone will correct me if I'm wrong).

    There's a lot I didn't say.

    I have an outright futures position in the Schatz, entered on a system with positive expectancy. It wasn't quite doing what I had expected when entering. So my choice was to flatten at a small loss, wait for the loss to get bigger and then flatten, or do something about it.

    In this case I decided to do something about it by making the position pretty much delta neutral by selling options against it. Just hitting the bid in the right quantity would have given me the delta neutrality I wanted, but holding out for a better price gave me delta neutrality plus cushioning.

    Getting the options leg done at the price I wanted took longer than I expected in a market as liquid as the Schatz, and *that's* what I asked about.

    While I didn't yet have the options cover the outright futures had a protective stop nearby well in line with my money management criteria. Now that I have the options cover the payoff of the net position is more in line with my revised view of the market, and I still have plenty of time and opportunity to adjust it in case the market proves me wrong again or part of my position is exercised away.

    To summarize: The market facts changed. I changed my opinion of them, hedged my position, and had the temerity to finesse the hedge. My risk of loss is no bigger than before (my money management is still the same), but the expectancy of my futures trading method is improved.

    Methinks the honourable gentleman opposite jumped to conclusions on too little data. Now that's dangerous.
  7. sjp


    What? What was all that last message about? Gibberish.

    Lets stick to the plain facts here (something I suggest you practice). Fact - you are complaining that you cannot get filled while admitting that your price inputs are unrealistic. My suggestion is to be prepared to execute the price you wish to trade at.

  8. Cutten


    Most of the Eurex options trades get done over the phone (then crossed on the screen), so the screen liquidity is poor. If you want to trade them, best to get a broker who does business in them. Trading them on the screens is a joke.
  9. Bingo - now that explains the wide spreads in what looks like an otherwise liquid market. Thanks for the explanation.