Should Options Traders Care About Mid-Prices? It depends. There is an art to getting your trades filled at the price you are willing to pay. In this episode we outline some of those and how you can use them to your advantage.
Click here or in the video to get the details!
Here is the member’s question:
“I’ve been around long enough to know your thoughts when it comes to worrying about getting the perfect mid-price, but my question is about best practices when it comes to placing trades.
My current process is to enter my trade in Think or Swim (TOS), hit the padlock on limit order, and watch the price bounce around and eventually land on a mid-price. Once found, I confirm the trade. Sometimes it fills right away – great. Other times, I feel like I am chasing the price, adding/ subtracting a few cents every minute or so. After doing this for a few minutes, I sometimes end up 20-50 cents off of my initial read on what the mid-price was.
Is that normal to be so far off? I feel like a cat chasing a string with the market makers laughing in the background.”
In this segment we dig into information on market makers, mid-price factors, algorithm, price strategy and getting anchored on a price to answer this member’s question.
There is lots of fantastic information in this segment, you’ll want to take notes!
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