Do out of the money, VIX calls result in bid 0 ask 5 cents?

Discussion in 'Options' started by howard555, Feb 13, 2012.

  1. howard555


    Here is what I know.
    The last day to trade the Feb. VIX options is Feb. 15th.
    The "special opening quotation" of the VIX will be calculated on Feb. 16th. The calculation will occur at 9:30am and will be based on the SPX options. Those will take into consideration any news that occurs after 4pm the 15th and before 9:30am the 16th, that would affect the S&P and it's options.

    I know if a stock closes at $19.80, the $20 call will have a bid of 0 and an ask of 5 cents (or possibly 10 cents) and essentially expire worthless.

    If I am short a Feb. $20 VIX call, and after the options for the SPY have found their destination for 9:30am the 16th, "if" the VIX was $19.80, would it also expire worthless?
    Or can the market makers keep a bid-ask of 15-25 cents, or even higher?
  2. You're one day off.

    Suggest you stop trading these until you get a chance to read up on the contract specs.
  3. howard555


    My dates were a typographical error. The last day for trading is Tuesday Feb. 14th and the settlement on the Wednesday the 15th.
  4. FSU


    The last day to trade the Vix options is today. They are cash settled based on the VIX indexes settlement print tomorrow morning. This is based on the opening prices of the March SPX options.

    If you have any position in these options your fate rests solely on this mark.