Trading the SMH

Discussion in 'Trading' started by Kicking, Mar 5, 2002.

  1. Well I have been looking for a way to play the semis for a while, thought the SOX options needed to much capital. I don't know why I never thought about the HLDR's until yesterday big move! Anybody day/swingtrading them and their options? Which is the best execution venue? ISLD?
  2. Last time I looked, which was a few months ago, the HLDRs had very big spreads, but I was looking at HHH and IIH
  3. Magna

    Magna Administrator

    Spreads (and volume) on many of the holders are terrible, but SMH has good daily vol (avg about 3.6 million), and spreads are a fairly decent .05 -.15 (equal to about 1/8 in the "old" days)
  4. Babak


    SMH are rather illiquid (unless you are swing trading or holding for medium/long term, I wouldn´t recommend it as a trading vehicle)
  5. I put it in my watchlist yesterday and the spread seems to be similar to the Q's, now they maybe more liquid because of the past couple of days move . They are very active too, the intraday charts are nice. It looks like a good daytrading vehicle. But I am more interested in the options, are they better than the SOX?
  6. Babak -

    Why illiquid?

    As Magna noted, the SMH has good volume (3.6M average with days up to about 7M - already 3M today at noon ET) and decent spreads (about a nickel at the moment but have seen it up to 15 cents) and the bid/ask size is currently 5000 x 5000.

    It seems liquid enough - although spread size might be too wide for scalpers but not too big for other kinds of daytrading
  7. Babak


    My bad. I hadn´t taken a look at SMH for a while and I thought it was trading with little volume (half a M). Obviously things have changed. Thanks for bringing this to my attention!

  8. poor spreads makes you long for the NASD level II days of old. unfortunately the SuperDOT and the Amex equivalent, somehow seem to be neutralized, even when you post orders for 500 shares or less at market or market executable limit orders. simply put the specialists don't seem to be making as fluid a market as one would need to participate (read trade such), or simply their clerks are not updating the bid/ask frequent enough to convey fluidity in their shares/market.

    hope that makes sense....
  9. trdrmac


    For what it is worth, there have been some nice moves in many of the holders over the past year. OIH, PPH and UTH have been some of my favorites. The spreads are wide, so you definitely need a longer term holding period. And forget about the options unless you are a seller, as they barely trade. is the website, it lists the components that make up the various baskets. I shares also have some good baskets to trade, some with options like IBB which is the Ishares Biotech Index. But again spreads are wide so holding times need to be spread out.

  10. can you short the (SMH) on a downtick like the qqq,spy,dia?
    just wondering...i looked on the holder site and the amex site , but couldn't find the info..
    #10     Apr 23, 2002