Futures Options Quotes

I am considering trading futures options spreads again (I did that about ten years ago). I was wondering if any of the firms have electronic quotes or do you still have to go to the floor to get bid/ask on spreads? Thanks (trading most markets except the stock indexes)

 

Options spreads / strategies are electronic and you can see them on tt

 

A lot of the markets have electronically traded options nowadays. For those markets you should be able to get a platform with electronic bid/ask/last and, best of all, electronic (fast) execution.

 

Thanks for the quick replies. Any brokers you would recommend that have access to these quotes?

 

There are two ways that trading software handles spread quotes on futures options - depending on the software.

Method 1 - Certain spreads are supported by the exchange. These usually include the most common spreads. Spreads are bid and offered as spreads. Some software will support method 1, some will not.

Method 2 - Some software will synthesize spread quotes out of current bids and offers. In this case, the software will leg the spread when the bid and offer line up.

This whole area is poorly understood and a little obscure, so be sure to ask pointed questions so you know how your trading software works. Some software supports method 1, some support method 2, some support both, and some support neither.

 

beware, you'll have to "RFQ" (request for quote) to get a market in a spread you are interested in. then, if you are lucky enough to get a bid and offer it will be much, much wider than the market in the pit

 

Good point. Truth is, it may even be wider than you could leg it for yourself. This system is a good idea and may really work in the future, but for now it's not really ready for prime time. Way too thinly traded.

To execute spreads in futures options, in most cases your best bet is really the pit. Retail access to such though is spotty and depends on your broker. If your broker has a desk that can communicate with a broker in the pit, that's worth something. If the desk is right there at pitside and the clerk can communicate with a broker in the pit while you're on the phone, better still. And if you can actually talk to a broker in the pit, that's the best. That brings you closest to the action, and will likely get you the best fills. It's also the least frustrating.

 

Thanks for the info folks. Sounds exactly like it was eight to ten years ago. It was insane getting quotes and fills even when I was calling the floor.
I think I will pursure other strategies.