Question on option liquidity and open interest/volume

Discussion in 'Options' started by Victory5, Sep 9, 2015.

  1. Victory5

    Victory5


    If I buy 100k worth of puts on VXX (even if I took a position in the underlying as well), its not going to do anything to the ETF which has its price entirely derived from the movement of front month VIX futures.

    Edit: Or are you talking about the options market specifically?
     
    #11     Sep 10, 2015
  2. newwurldmn

    newwurldmn

    100k listed contracts is a noteworthy trade in the SPY (about 10MM/point). 10,000 is pretty standard in insititutional space.
     
    #12     Sep 10, 2015
    lawrence-lugar likes this.
  3. ktm

    ktm

    There are caps for CME and CBOT products. I think the limit for SP is 28,000 contracts (for all months combined). This number is for directional exposure though, so if you are putting on net neutral spreads, the number may not apply. You also may be subject to large trader reporting if you are doing 100+ lots on these. ES contracts are all of these numbers multiplied by five.

    If you really have this problem, congratulations.
     
    #13     Sep 10, 2015
  4. Victory5

    Victory5

    Ha, well I don't think i'll be brushing up against that anytime soon (read: never).


    It was more out of curiosity and the sizes that many of the larger traders play around with in some of the more liquid options markets. Basically....how big is too big.
     
    #14     Sep 10, 2015