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To: Kayaker who wrote (72938)	10/19/1998 4:13:00 PM
From: nihil	Read Replies (1) \| Respond to of 176387

RE: Prices move ... Craig, I don't know how the ba-spread moves and I can't experiment because I don't currently have access to streaming real time quotes unless I have a a trade on offer. Before I bid, a check the current real-time quote and make my bid and wait (often interminably) for a fill, but the open order display includes updating real-time quotes. I have seen the quote move to my bid (on many occasions), but have not noticed the ask to change at the same time. I understand the way most option pits work is a clerk is recording actual trades and this generates a highly accurate record of last price. The bids and asks are simply being yelled or semaphored around the pit and a monitor is taking note of these and entering them in the computer. He isn't able to catch every bid or ask (every market maker is intermitently emitting both, and all this data, along with the ba, sales, and volume are displayed on the ticker monitor for the crowd). A busy pit is near bedlam, and an idle one is more likely to be fully and timely reported. The MM in the idle pit faces little demand or supply and has little temptation to narrow the spread offered simply to stir up a little business -- it won't happen, so he continues to try to buy on the bid, and sell on the ask -- every trader's dream -- if someone like you or me pops up and actually has an active enough broker who offers a better bid than the other traders, the market maker (scalper) will sell if he wants to trade and if he cannot find a higher bid . He has no interest in filling the low bids of other locals or public traders. The hitch, I suspect, is that there are no market bids coming in -- and the limit sellers are of course asking at the Ask. Nothing happens until a limit seller gets frustrated and changes to a market order, or someone chokes down his disgust at the wide spread and enters a market order. The scalper may also decide to unload his inventory for a small profit or loss when he sees the underlying shift, or when he gets tired of the inaction and wants to move to a more active crowd. I wish some one with recent AMEX option floor trading would straighten me out, because, I, like you spend too much time waiting for fills.