I wanna trade RUT!

Discussion in 'Trading' started by nfactorial, Oct 1, 2010.

  1. charts


    You're obviously a beginner trader, so you'd do yourself a great service to study before getting into action. Relying on forums advice is suicide ... :)

    Trading intraday options is very ineffective due to slippage, commissions, IV skews, etc.. If you're not satisfied how the futures and the ETF relate to the index, you'll find that options track it much worse. Just watch the real time quotes, buying the ask and selling the bid, and you'll immediately see what's happening ...

    I know it's easier to ask around, but I strongly advise against relying on it ... :)
    #11     Oct 1, 2010
  2. Well, I was going to warn that if he tried intraday speculations on the RUT via options, he'd very quickly find that the bid/ask spreads would murder him.
    #12     Oct 1, 2010
  3. Thank you.

    That's what I wanted to know.
    #13     Oct 2, 2010
  4. spindr0


    The beauty of options is their leverage - you can get large returns from a decent move.

    What's hideous about them is the slippage. You can buy 100 delta options to particpate in smaller moves but that gives up a lot of the leverage and subjects you to gamma.

    If you have good timing, you can get away with murder. If not, you become the victim :)
    #14     Oct 3, 2010