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Best way to get filled on option spreads?


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  #1 (permalink)
keong
Singapore + Singapore
 
Posts: 13 since Nov 2015
Thanks Given: 10
Thanks Received: 2

Hi,
I'm currently trading options on commodity futures on IB.

I've noticed that getting fills on ratio credit spreads on options on IB can take quite a while and be quite frustrating.

For e.g., if the B/A is -0.20/-0.30, if I put in a bid at -0.25, the B/A almost immediately adjusts itself to -0.15/-0.25. This happens to almost every commodity that I've sold options in (CL, NG, ZW, etc.). I can only get filled if I go in at/close to the middle of B/A and wait (sometimes within 1/2 hour to several hours or not at all). Needless to say, this is most frustrating as I seem to be trading against a market maker or trading algo who just lowers prices in response to a lower bid by me.

Is this a feature of the liquidity in the options markets or something that's idiosyncratic to IB itself?

What's the best way of getting filled for credit spreads?

Cheers,
K


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  #3 (permalink)
 myrrdin 
Linz Austria
 
Experience: Advanced
Platform: TWS
Broker: Interactive Brokers
Trading: Commodities
Posts: 1,938 since Nov 2014
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It is my experience that for the energies (and the softs) it is more difficult to get a good fill than for grains, beans or meats. I rarely succeed with a fill in the middle between bid and ask for these commodities, whereas for CBOT traded commodities it often works.

This is true for outrights as well as for spreads.

I do not know if your problems have to do with IB. When I traded with them I did not recognize such issues.

The best way to get a fill is placing a limit order during day trading hours (former pit trading hours). Volume can be better after the open and before the close (of the former pit trading hours).

Good luck !

Best regards, Myrrdin


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Last Updated on February 17, 2016


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