Ed, re: Tony's post, I'm curious about your opinion about something.
First, I liked your description of this market a few days ago--no bull, no bear, just extremely volatile with an upward bias, allowing rich premiums on options. Clearly the market was not like this in years/decades past.
However, that may sometimes put the MM in a tough spot. What do you think? I got a PM recently from someone on SI who noted that puts he had sold a while back would not go below $2 even as the stock continued to rise. Thye just stayed at two bucks, whereas in the past they surely would have gone down beneath a dollar.
At the same time, when I speak to Fidelity Spartan traders about how the options prices don't seem to move in concert with the stock as closely as they could/should, they keep saying options trade on their own especially in a fast market. Doesn't that allow a lot of room for slippery doings? Am I wrong, or is that one way MM can fight the kind of market they never expected, where individuals are making unprecedented $ on the volatility?
I'm curious how things have changed over, say, the last decade.
Two days in a row I put in a limit order for EMC 2001 110's. They were hovering around 16, a little over, a little under. Even though EMC dipped a bit during both days, I never got filled. It's no big deal, as I can try again, and I just felt like shaving off that quarter (it's sort of like playing a chess game) but I have to say it doesn't make sense to me.
Thanx in advance
Jill |
