Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Canadian Options -- Ignore unavailable to you. Want to Upgrade?

To: Porter Davis who wrote (1514)	4/17/2000 12:29:00 AM
From: Robespierre	Read Replies (1) \| Respond to of 1598

>Well, Robespierre, I hope you're proud of yourself. I guess you weren't listening when your momma told you there's no such thing as a free lunch. What's with the animosity, Port? And on a Saturday morning at 6AM... You go into the weekend delta long or something? You must have slept straight through finance class during the lesson on how arbitrage promotes rational and efficient prices. Never mind. Speaking of prima facia unreasonable not to mention unethical, I notice that your BCE April 150 Puts have a closing Bid/Ask spread of: 10.75 - 12.60, BCE at 139. You really trading at these prices, Port, or are your quotes bad too? Lets see now... Port buys @ 10.75, and then immediately goes to www.interactivebrokers.com and gets a bid/ask spread of US$9.75-$10 on the BCE April US$110 Puts, BCE at US$96. That's right, 25 cent spread. New York on the Bid, Chicago and the Ask. Nice and tight. Then, Port sells the $US110s for $9.75 in New York. Now crunch that with an exchange rate of 1.477. Lets see.... Port sold a put with a higher strike price for $1 above intrinsic value and Port bought a put with a lower strike price for 5 cents less than intrinsic value... that spells arbitrage profits! I guess you weren't listening either when your momma gave you the free lunch speech. >Why don't you take part of the proceeds (after you pay your taxes, of course) and buy yourself a book on ethics. Can I share it with you? Actually, when I'm done with it, I'll just sell it to you for more than what I paid.