This opinion makes ABSOLUTELY no sense to me and I vehemently disagree with your assessment, Mark. If you care, pls do enlighten me what your reasoning might be. At any rate, the unofficial masters of this forum have spoken... You shall hear not a peep more of this from moi.
Marti, I agree with you 100% there is no reason for that sort of childish statement. I dont think there is a whole lot of value in posting that stuff but Mark is way out of line IMO. If you want to post volume info IMO by all means keep on doing it, no one owns this place and its a good forum for sharing info and ideas.
I'm not telling you anything you don't already know, but the problem with volume, or any specific trade, information is: 1) Unless you know how the trade is hedged, there is no way to tell if the trade is bullish or bearish, or neutral 2) If you could know if it was bullish or bearish, that would not help because you don't know if it's an insider, trading with information, or a hotshot taking a stab at something for an unknown reason 3) Because many beginners like to trade by following the trades of others, in my opinion, a post describing high volume in some specific options MAY encourage some rookies to make a trade in that option (or underlying), believing that the volume information gives them a 'tip' on how the stock will move. To me that's dangerous. That's why I don't like posting of such information. 4) If there's a point to be made about the trade, or something special to discuss, that's different. There may be some nugget we can all gain. Apologize if you and or xflat feel I'm out of line. I feel volume information (for example) doesn't provide enough positive to overcome the negative. My 2 cents. Mark
Mark, This board is litterred with that very same opinion from you many times, we get it. Thats no reason to go off and post the way you did and guess what, its only an opinion. I dont believe there is any value in that info either but there is also no reason to be rude. The horse is dead beating it further wont make it move.
Martinghaul, I appreciate your postings. You are a critical player and you are adding quality to ET. Keep on posting and let every ET member decide whether it's useful information or not.
I am not offended or anything like that, so it's nothing childish. It's just that if there's a consensus that there's no info, no ideas or meaning in these sorts of posts, I'm perfectly happy to stop, honestly.
Markâ I think what Xfalt is referring to below is your (not so impish) tendency to be too dogmatic, or authoritative at times. So, let us put it to a test (actually a quiz). Here is some data of a particular trade I pulled from trade-alert.com. You might want to also know that the OI for the14 strike was 7621 and for the 10 strike was 17,829. Also, let say that over 90% of the buy leg was executed at the ask and over 90% of the sell leg was executed at the bid. The trade was executed as a one-block speared at 10:07am. So what will be your reading/Interpretation of this trade info (yesâyou may use all information you have on the sector, underlying, market, etc, but you can only speculate on the trader, and yes, you may be as dogmatic as you see fit). Are you up for this challenge :>)? Quantity Symbol Expiry Strike Type Price Side Exch. Time Volume Spread Ivol Spot Change Close Link 18500 XLF Jan11 14 Puts $2.47 ASKSIDE 10:07:08 18500 SPD 39.12% 14.10 -0.23 $2.41 detail 18500 XLF Jan11 10 Puts $0.84 MIDMKT 10:07:08 18500 SPD 42.21% 14.10 -0.23 $0.83 detail PS: it is a very slow weekend for me.. BBen
I donât know what model youâre using or the inputs you used to come up with those IV numbers so they are meaningless. I donât know whether that trade was sent to the market or shopped around, I am guessing it was shopped. That being the case then the net price of the spread was agreed on before they set the prices of the legs and therefore all they had to do was make the price of the legs fit the markets when the trade hit the tape. So whether one leg traded close to or on the bid or ask is meaningless. I also donât know which side initiated the trade or what if any they did in the stock vs that trade. So basically there is not a lot to learn from it. THats my opinion
Well--let me help you a bit. 1) Do you think this was an opening trade, or a closing one? 2) Was it directional or not? 3) Was it placed for credit or for debit? 4) Can you infer what direction the placed trade was leaning? (bullish or bearish in its disposition, though I am not asking about traderâs intent)? 5) Under what circumstance a trader (such as yourself, say) would put on such an exact trade (you may re-scale delta if desire)? 6) What has to happen (between now and the expiry) for this trade to be profitable? (you may speculate on traderâs intent as you wish) 7) If your contention of a pre-arranged speared price is correctâwhat is the perceived odds the trader has for successâat least with the given 2011âtime horizon? 8) For the given informationâwhat is the volatility implied for each of the strike (by the trading prices) and what is the âspeared IVâ? (you will be also able to check if the given IV figures are meaningless or not) You see Xflat, if you really want to, you can definitely say quite a bit, though I was hoping Iâll hear some response from Mark. In any case, would you like to try again? BBen