Limit Bid Price

Discussion in 'Options' started by ADLE, Feb 24, 2006.

  1. ADLE


    Hi ALL,
    I am completely newbie for options trading.
    Please tell me is it possible to get filled on options on limit bid price? How do I calculate which price to ask in this scenario:
    bid ask
    0.40 0.65
    And how about selling on limit ask price?

    Does it matter which broker I use to have my order executed on limit bid/ask price?
    I am using IB right now.
    Thank you for any input.
  2. MTE


    Do you want to buy at the bid and sell at the ask or vice versa?

    If it is the former then unless the market moves against you you will not get filled on the bid when buying or on the ask when selling.
  3. ADLE


    So basically you 're saying price must be in between to get filled.
    If I bullish and market goes south then my probability to get filled on initial limit bid price much higher then before, because my limit actually became a middle/between bid-ask price.
    Thank you.
  4. novel20



    You can bid at any price you want, but if you are very eager to get filled now, you hit the ask. If you are willing to wait, you can always put it in between the b/a or sitting at the bid.
  5. ADLE


    So what happen is you always will be off if you bought at the ask
    and stock goes against you you have to sell at the bid, huh???!
  6. novel20


    Yes, because you are paying for the b/a spread. If you don't like paying the spread, just buy the underlying stock if you have the money. The spread in the underlying stock is always tighter than the option spread.