OTC average strike this week?

Discussion in 'Options' started by redsquirrel, Apr 7, 2011.

  1. Yes, first post. Lurker for a while.

    So this is the first full week of the second quarter and we have the whole issue with Europe/QE3/USbudget coming up in the next few weeks/months, plus other MEast issues ongoing and whatever else...

    Given the very tight price action in the sp500 this week - both the range and the daily closes being tight - could any of you guys/gals who have an option focus come up with some sort of OTC structure that might be being struck over this week, based on closing index prices of the sp500?

    Clearly it may/would be a large trade and something that the IBank would agree with the client that they WOULDN'T take advantage of in terms of manipulating the closes (perhaps that is structured into the OTC?). Exit would be a different story...

    I am not a conspiracy guy, but the price action is a little weird. If you just think that it is a quiet market then fine. However, I would welcome ideas about what sort of OTC would 'assist' in the price formation that we have seen this week, even if nothing is being struck.

    Basic background: I have been trading since '93 for banks and myself and have basic 'greek' option knowledge, but am lacking in the OTC knowledge - 1 delta guy! I have seen many weird markets but this week just 'feels' strange. I position/swing trade sp500, no options, 100% systematic.

    I would appreciate your thoughts.

    Many thanks.