So I just do covered calls mostly on boring stable companies...Cash flow. I don't want to get into which option is better...This or that. Below is what Fidelity has me OK before I enter a directed order. I see nothing strange about entering through an exchange vs Fidelity. Fidelity always says..."You could get a better fill"!! My thoughts are you don't even put it out to market unless you have a match (PFOF). No options traded today at the strike price of the stock, so does it really matter?? If I'm out two/three dollars on a $200. ticket, life goes on. And yes, I put a limit on the trade... Again, my questions is...Do you see anything below that would scare you from not wanting to use a common exchange (example CBOE)?? By selecting Directed for Route when trading options on Fidelity.com, I indicate my acceptance of the Directed Trading for Options User Agreement and acknowledge and accept the risks set forth herein. Risks Due to the nature of Directed Trading through different Exchanges, this form of trading may pose certain risks which may be greater than those present if orders are routed through Fidelity's proprietary order routing system during standard market hours. For example: Liquidity. Liquidity generally refers to the level of trading activity and the volume of securities available in the market to be traded. In general, the greater the liquidity in a security, the greater the chance an order will be executed. There may be a lack of liquidity (buyers and sellers) when directing an order to a specific Exchange, which may prevent your order from being executed, in whole or in part, or from receiving as favorable a price as you might receive when Fidelity routes your order during standard market hours. All or None (AON) is an eligible trade condition for directed orders, however AON orders may cause customers to lose priority. Price Volatility. Price volatility generally refers to the speed and size of changes in the price of a security. There may be more price volatility on the Exchange you route your order to, which may prevent your order from being executed, in whole or in part, at as favorable a price as you might receive if you used Fidelity's proprietary order routing. Definition of Directed Trading through an Exchange. Directed Trading of options through Fidelity.com allows you to view bid/ask quotes, with size, on each of the available option exchanges. Customers can populate an order window by selecting a bid or an offer and sending an order directly to a specific Exchange for potential execution. Directed Trading for Options should not be confused with Directed Trading for equities. Access to Other Markets and Market Information. The Directed Trading for Options order ticket of Fidelity.com provides real time Bid and Ask prices and size for a particular option on each of the various option Exchanges. The ticket also reflects the NBBO for the option based on these exchanges. If you direct your option order to a specific exchange your order will not be routed away from the exchange it is sent to unless you modify the existing order. Communication Delays. Delays or failure in communications due to high volume of orders or communications, or other computer system problems, may cause delays in, or prevent access to current information or execution of your order. Fidelity will not look for an alternate routing destination if you have chosen to direct your order to a specific Exchange. Only if you have selected "Auto" to use Fidelity's proprietary order routing system will Fidelity look to redirect your order due to a communication or system problem. Terms and Conditions Trading through Fidelity.com's Directed Trading application is subject to the terms and conditions ("Terms") and policies set forth by Fidelity and is subject to change without notice. By clicking I Agree or using the Directed Trading for Options application, you acknowledge your understanding of the risks set forth above and your agreement to the Terms set forth below. Fidelity reserves the right not to accept an order through Directed Trading for Options at its discretion. Each available Exchange reserves the right not to accept an order at its discretion. You should monitor your orders for execution or cancellation status. As stated previously, by directing your order to a specific Exchange for execution, Fidelity will not take into consideration all of the factors when it routes an order for you. These factors, which are designed to result in favorable transaction processing, include size of order, trading characteristics of the security, favorable execution prices (including the opportunity for price improvement), access to reliable market data and availability of efficient automated transaction processing. You also understand that communication line problems and/or system problems either at the Exchange to which your order was directed or at Fidelity, which may prevent the submission of your order, may result in the cancellation of your order. Fidelity will not redirect your order to another Exchange or through our proprietary order routing system in the event of communication line or system problems. The following Exchanges are currently available to direct orders to through the Directed Trading application: AMEX: NYSE Amex Options Market BATS: BATS Options Market BOX: Boston Options Exchange CBOE: Chicago Board of Options Exchange ISE: International Securities Exchange NOM: NASDAQ Options Market PCX: NYSE Arca Options Market PHLX: NASDAQ OMX PHLX Available Exchanges and availability of certain order types and conditions are subject to change without notice. The Directed Trading for Options application is available for executions from 9:30 a.m. to 4:15 p.m. Eastern time for Indexes and between the hours of 9:30 a.m. and 4:00 p.m. Eastern for Equities, Monday - Friday except for market holidays. Order entry using Directed trading can be done at anytime. Please note, sending market orders after market close could result in executions higher or lower than expected based on market movement during the next available market session. Each Exchange defines which securities are eligible for trading, and these securities may change daily, or throughout a given trading day, based on market conditions, trading halts in a security, or other factors. Orders for securities that are not eligible for trading will be rejected and the order will be cancelled. Fidelity will accept Buy to Open, Buy to Close, Sell to Open and Sell to Close limit orders, as well as All or None (AON) and Fill or Kill (FOK) orders when routing to an Exchange through Directed Trading for Options. Order types accepted include Market, Limit and Stop Loss orders. Not all Exchanges accept all order types. While there are no posted maximum order sizes, acceptance of large orders is at the discretion of the individual Exchange and is subject to change without notice. Fidelity also reserves the right to limit maximum sizes for orders sent to any Exchange. Please note that sending large orders to an Exchange may cause market prices to move adversely to your order. You may attempt to Cancel and Replace Directed Orders for Options. If you increase your quantity or change your limit price, you will lose time priority on the Exchange order book. If you are reducing your quantity, you may be able to retain your spot in the Exchange's order book. Attempts to cancel and replace orders are performed on a best efforts basis. There is no guarantee that an open order can be canceled and replaced, in whole or in part. In addition, there may be a delay in canceling and replacing orders for Exchanges that route orders to other Exchanges. While your order is at another Exchange, it may not be possible to cancel the open order, and you may have to wait to be able to cancel or replace. Fidelity has established certain order entry edits that apply to all of our electronic channel products. These edits are designed to provide a level of risk protection to our customers and to Fidelity. Fidelity is not liable for delays in the transmission of orders due to a breakdown or failure of transmission, communication or data processing facilities, or any other cause beyond our reasonable control. Transactions are subject to the applicable rules and regulations of the self-regulatory organizations and governmental authorities. If you elected to set a Default Account for Trading and/or Display Account Nicknames on the Trade Preferences screen, those selections will also apply to Directed Trading for Options. If you elected to view Account Nickname rather than account number in the trade ticket(s), you understand that you will not view the account number prior to submitting a trade through Directed Trading order entry screens. Please exercise diligence to ensure all trades are executed in the account in which you intended. Market Orders - Market orders sent to exchanges using Directed Trading for Options may not execute at the same price as they would if sent to Fidelity. Different Exchanges have different rules for/approaches to price and liquidity improvement and this may impact your execution price. Fidelity has no control over the executions at a specific Exchange, but Exchanges must adhere to the applicable...ect Again, no iron condors, no naked puts, just a simple covered call. PS I usually go high for my price...Then keep dropping every 5 minutes or so. If I don't get a fill...No biggie.
With Fidelity?? Can you prove it?? Fidelity does not place their options into markets unless they get a match...It sits on their desk. With a market bid/ask everyone sees where you stand...And can respond (or not). With Fidelity and stocks, they will send it to market (unless they already have a match)...But not their options.
option price normally is 5 cent increment. i have two limited orders sitting at bid with zero volume. fidelity can fill me at at the last price or better. while the second broker, TradeStation, never got fill.