Formerly About Applied Materials Message Board

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Politics : Formerly About Applied Materials

AMAT 260.77

+0.2%

Dec 24 12:59 PM EST

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To: Guy Gordon who wrote (33801)	1/15/2000 7:06:00 AM
From: w0z	Read Replies (1) of 70976

The options are written (created) by the Market Maker. Unless they are written by another person...you can usually tell by looking at the spread. If you see a spread that is lower than normal, it means someone has a limit order on the other side of the option. Your concern about illiquidity is also a good one. The spreads on most options are usurious. And the MM can easily move the price if you try to buy or sell too many. The MM is only required to sell or buy 10 options at quoted bid and ask. If you plan to trade more than 10 at a time, it is imperative to use limit orders. In a stable market (does that exist any longer?), you can usually place a large order halfway between bid and ask and it will be filled in several hours. Many people form conspiracy theories about the evil Market Makers manipulating their stocks. It just doesn't happen on stocks of any reasonable size (i.e. non-penny stocks). But they sure as hell do manipulate the options prices. Badly, and to our detriment. Manipulation does still happen in thinly traded stocks (like CFMT). But it's SO SWEET to take money from them like I have with my options in COHU, CYMI and MTSN! Yesterday was a very good day. <VB$G> siliconinvestor.com

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