True, I agree with rb7 on this one. Looks lilke one end of the trade was open while the other was closed. This happens every now and then, so I won't really consider it as being unusual. The difference of 3 is also possibly due to adjustment at OCC. Anyway, it's good you noticed
Absolutely. I try to keep truck of the sentiment on a given Underlying also by looking at where the big money goes. So it is important to check if someone else sold (bought) to an institution buyer (seller) or to someone else who has simply a different opinion.
Good point. Indeed, I try also to check whether I am a looking at one leg of a vertical spread, to a rollover or a contrarian transaction on the underlying and so forth.
It could also be part of a long/short portfolio or vs stock. Quick story-When I was a MM on the floor, one of the Options I made markets on in the early 90's was Union Carbide. There were always takeover rumors. Once every 3 months, an order would come in to buy 3000 OTM calls. About 10% OTM. We all thought it was "hot money". The stock slowing declined and never spiked. After the third buy order, I asked the floor broker handling the order for the Salomon Brothers client, why the client was paying about $0.35 for 3000 calls every 3 months, he told me the client was very short Union Carbide and it was a hedge. Moral of the story-it is very hard to get alpha from watching order flow and Open interest. You just do not know what their bet or hedge is. Best, Bob
Thanks for sharing the story. It is nice to have someone with your experience and knowledge on this board, Robert. Absolutely. For this very reason I think that it is very important also to monitor the underlying, as I mentioned in my last post.