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Strategies & Market Trends : Option Spreads, Credit my Debit -- Ignore unavailable to you. Want to Upgrade?

To: Jon Tara who wrote (1119)	1/8/2000 6:30:00 PM
From: jjs_ynot	Respond to of 2317

Jon, There are a number of Market Makers on the floor of the exchanges (at least CBOE and Philly) that work on each underlying security. They operate under rules that are different that the NYSE specialists. You are right that they ordinarily are obligated to execute 10 at a certain price; however, I have seen them move the bid and ask. This movement (moving the bid and ask) is especially true if you have a market order at the open. Do you normally put in market orders of 10 or less on very liquid options? Dave

To: Jon Tara who wrote (1119)	1/11/2000 9:36:00 AM
From: KFE	Respond to of 2317

Jon, The specialists (not MMs - in options they are called specialists, and there is only one per underlying per exchange - just like exchange-listed stocks) have an obligation to fill up to 10 contracts at the posted price, and in my experience they always honor that obligation. I believe that the order books on the PHLX and AMEX(specialist based systems) are run by specialists who trade for their own accounts as well as handle customer orders. The order books on the CBOE and PCX(market maker based systems) handle only customer orders. The PHLX and AMEX also have market makers in each option which provide the liquidity. Also remember that auto-execution systems can be turned off in "fast" markets. Regards, Ken