IB Pricing Question

Discussion in 'Options' started by oraclewizard77, Jan 24, 2011.

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  1. oraclewizard77

    oraclewizard77 Moderator

    I checked yahoo finance, and SVNT March 10 puts were selling for $ 1.10 . However, I go to trade them on IB for example selling them naked, and IB is listing them at $ .88. So I manually change it to $ 1.00 and get filled immediately. So my thought here is if you are getting $ 1 no problem, why are they being listed at $ .88? Is IB hoping someone makes a mistake and they pocket $ .12 per option?
  2. #1 yes. Thats how you get the low cost commissions.

    #2 OR maybe that 1.10 was the last trade. :)

    What sounds more logical #1 or #2?
  3. Bob111


    hey..on other hand-it's cheaper,if you are buyer,right? :p
  4. Bob111


    logical is not to use free yahoo data :p
  5. FSU


    The current market (best bid and ask of all the exchanges quoting) is .83-1.10. I see 2 contracts traded with a last of 1.

    The 1.10 offer is currently for a 20 lot so my guess is it is a limit order instead of a market maker quote. This tells me the inside market bid is closer to the 1.10 offer. Ib wasn't cheating you, simply giving you the current best quoted bid. This is why you should always use limits. Seems like a fair fill at 1.

    The 1.10 price was the last trade, before you traded at 1.
  6. Yahoo data is very good, and easier to access than your brokers data.- The OP's trade has already shown up, he sold one or two contracts.


    IB and Yahoo option quotes are usually the same. My guess is that if the OP entered a market order, or a limit order at IB's price he would have got filled at $1.00 - the price he ended up getting.
  7. I would not say IB is ripping off since they can't. They are a big brokerage and have to adhere to best prices.

    If IB is listing the options at 0.88 why did you put in a bid of 1? I would have put in 0.88 since that is what is being offered.
  8. oraclewizard77

    oraclewizard77 Moderator

    I put it in at $ 1 GTC order since I saw that at least 1 contract got traded from yahoo finance data at $ 1.10 and current price of the stock was close to its lows of the day when I put in the order. I need at least $ 1 as a safety net, the GTC limit was fine for even if I had to wait till Tue to get filled.

    I disagree with any that think I could have gotten $ 1 with a market order or leaving the price alone as a limit order for $ .88. I would have instead been filled at $ .88 and lost $ .12. Remember I am selling a naked put and want the highest price possible.

  9. stoic


    Disclaimer on Yahoo. duh

    Quotes delayed, except where indicated otherwise. Delay times are 15 mins for NASDAQ, NYSE and Amex. See also delay times for other exchanges. Quotes and other information supplied by independent providers identified on the Yahoo! Finance page. Quotes are updated automatically, but will be turned off after 25 minutes of inactivity. Quotes are delayed at least 15 minutes. All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Neither Yahoo! nor any of independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. By accessing the Yahoo! site, you agree not to redistribute the information found therein.

  10. The only way to know for sure is to give it a try and see what price you get, it's only $12.00. I always use market orders with IB.
    #10     Jan 24, 2011
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