Bart------
---->Nemer-Can you help me understand how I could buy the oew-kp's for 10.3750 yesterday when the oex was at 934 and now it is 10x10.5 with a 5 point rise in the oex?
Maybe.
On the OEX the bid and the ask are akin to writing in the sand.
It's not very permament.
They flucuate without buys being executed.
---->It was down 30 minutes ago the option that is...when the oex was up 3 points.Whats up with this?
The bid and the ask don't have to run lockstep with the action of the OEX, rather they are affected by IMMEDIATE or ANTICIPATED immediate action on that particular option.
Reflect a moment on the pandemonium reigning on the floor and the need for adjustment in prices------it's comparable to a cat in a room full of barking dogs. The guy who is chunking out the price he'll give or take is just like that cat----eyes and ears and wide open and attempting to sense any movement from those dogs...no wonder the working life span of those floor traders is less than six years, or so I've heard.
----->BTW the puts lost value as well as the calls, It almost seems like they are saying that you can't make $$ here regardless of the oex movement!
Both puts and calls frequently lose value during the day at the same time. Some times they both gain at the same time. The floor traders are not altrustic to want to give you money, rather they are similar to a school of feeding sharks trying to tear your flesh and feed themselves.
But is this any different from the outside world ? Your main advantange is to narrow your focus to a small potrtion of the market and try to out smart it.
My recco to you would be to pick a single, two , or three postions (930, 935, and 940) and hand chart them or print them out every minute for an hour or so. Spend some time attemting to make some semblance of order in the flucuating priceing..... the O I doesn't move much, the Vol will .
I've done a poor job of trying to answer you question to me , but if you will follow the above paragraphs instructions for a couple of days you will probably answer it for yourself.
If not, I'll try again.
Regards---Nemer |
