Tradefair & Financials
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I trade quite a lot of options on US indices, but would like to start trading the FTSE ones too.
At first glance, though, it seems as though volumes are pitifully low. Is this correct? Why isn't there more of an active market?
At first glance, though, it seems as though volumes are pitifully low. Is this correct? Why isn't there more of an active market?
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Replies: 14
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Interested in having a chat about it, you on any other forums?
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No, but you can always email me:
b e t f a i r c o n t r a r i a n @ y a h o o . c o . u k (without the spaces, obviously). |
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I only do them on spreadbetting these days, so no liquidity issues.
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Goring,
Yeah I have done in the past, but it's quite a hefty spread to pay. |
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Not on IG. Aug 5225 FTSE calls: 22 / 25.5 right now. Dec 5200 puts: 276/282. That's pretty good.
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I meant IG too. I consider those spreads too large (I trade frequently).
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Hi everyone, can someone show me how to gamble FTSE on betfair, like the 20 minutes market?
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Churner, eh? :) Unless you trade 10 lots clips frequently I don't think you'll get access to better prices without broker / platform costs. On the other hand, if you trade that big, you'd want to be spreadbetting anyway to avoid a big tax bill, wouldn't you?
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Goring,
I'm building an automated trading system, so it's quite straightforward to make a market in any derivative, if I just plug in the underlying (assuming my model is decent). I thought of doing this for FTSE index options, mainly because this is an area where I think I have an edge. I've been messing about with this over the last couple of weeks, but I'm really surprised how little trade actually seems to go on. I would do the US equivalents instead (options on S&P or Dow), but the relevant exchanges actually charge for cancelling or moving orders, and so are prohibitively expensive for a small time player like me. If you have any suggestions for how I could proceed more effectively, I'd appreciate your input. Cheers. C |
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Not sure whether LMAX (new Betfair financial CFD exchange) will be doing them or not, but if so, might be a good place.
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Contrarian
How can you really honestly think ( or believe) that you have an "edge" in any of these types of markets. Certainly not a trading edge against the big boys with super fast computers and sophisticated algorithms. Maybe you think you have found some type of non-trading edge perhaps ? Pretty unlikely I would say also. But it's your money I suppose. Not being negative or unsupportive. Just realistic. I hope you prove me wrong. It would be a nice story to hear. |
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Btw I've just been re-reading about the LTCM catastrophe- so I suppose I'm a bit jaundiced today about perceived "edges ".
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FAFH,
I understand your scepticism, but I think you overestimate the extent to which the area of short-term volatility (my speciality) has been thoroughly researched. I have been using various machine learning techniques, guided by my experience of trading ultra short-term options over the last 7 years, to determine mispricings in the options markets. The key point is that certain commonly used standard option pricing models work well for most time frames, but break down significantly in the very short term ones. Although some of the quant people working in these areas may be aware of this shortfall in the option pricing models, there has been a lack of incentive to research this fringe area, because there is no primary market in ultra-short term options (only grey markets like the Betfair intras, for example). |
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Well I agree to the extent that markets are not "efficient" as is generally claimed. There are niches which can be exploited at least for a relatively brief period of time, before such trading gets recognized and copied to death.
Best of. |