You don't see this every day

Discussion in 'Options' started by mskl, Jan 3, 2019.

  1. mskl


    SHLDQ JAN $15 puts are $15.65 bid (lol)

    Can't trade it as only "closing trades allowed"
    elt894 and beerntrading like this.
  2. That's the ask...
  3. jonahern


    does indeed look like 22 contracts were bid and traded at 15.65...
  4. Oh, sure enough....13:37....filled at 13:45.

    Good find, OP! Lol
  5. elt894


    Nice find. I saw something similar (though less extreme) shortly after the bankruptcy, but also couldn't trade it. The thought has crossed my mind before of buying a bunch of fully hedged positions prior to events like these...
  6. mskl


    lol. it was bid for many minutes.
  7. mskl


    yes - i have done this. The negative part is that your margin requirements go up after an option adjustment (no portfolio margin etc). Typically at IB they will margin your account 1:1 with respect to the notional value of each contract. Can be expensive but virtually no competition after the adjustment (as the example above illustrates).

    There are many arbs available - you just have to do the work to find them......

    good luck
    elt894 likes this.
  8. elt894


    Good info, thanks. I have some other arb strategies I pursue, but monitoring stuff like this hasn't made it up the priorities list. Could be good for an IRA that has limited margin anyway.