This is my 2nd post after rejoining after I lost my previous password when I was a member some years ago.
Is anyone familiar with US Index options on the likes of the S&P 500 or in my case I trade Dow Jones Wall Street options with Spread bet companies.
If there are any Option experts out there I wonder if they may be able to advise...
I have had some recent issues with a certain Spread bet company that I am looking into and IG index .... On August 25th I had bought some Wall st ? Dow Sept 17000 call options (and some weekly call options thru IG index)...and the market rallied over 500 points in 2 days..
I expected a reasonable gain of at least to double my money ...(on the Sept calls) (I closed out the weekly calls too early to recall the true valuations on a 500 pt move during that 2 day rally)
to my dismay.. these Sept 17000 Call options had hardly gained at all...and made just about 50% on what Id paid.
Many a time in the past Id easily doubled my money on a 500 point move..
Yet this was during the what seemed very volitile period over a few days and they were offering very little gain on these call options.
upon querying this.. they said sometimes option volitily is what determines an options value.
and in this case this is one of those instances.and they were not valuing call options very favourably.. I suspect that
still had a bearish sentiment...but the increaes in value of the call options seemed VERY undervalued after seeing such huge market moves..
I felt rather cheated and I had this happen in the 2007 to 2009 crash..where I was overpaying for options .. seeing HUGE moves and then getting little gains... basically they can alter the Vol so much that when a market has rallied say in a few hours to a day..then they devalue the volitility..
and the value of those options show NO gain..
As this very rarely happens.. its very hard to really know the realities of what such options may be worth under such conditions.. they could be telling me anything... or maybe the market makers are just creating unrealistic valuations.
I feel I need a real expert to be able to investigate this for me..and wondered if one had such querys is there any sort of service or company/organisation that could investigate such complex issues..
also so many times have I seen my account values when holding options just litterlly disappear.. on what seem rather small moves in the market of a couple of days..and when the market comes back to simlar levels.. the values of the account has halved.
to me its all so easy for them to get away with it.. and I don't believe that are valuing these options correctly.. in such times they can make any excuse.
They also have been making huge wide spreads on the options.buy and sell prices. as much as 4 to 5 time more..on daily options and 2 or 3 times on monthly Sept options...
Yes the market has had days of huge moves.. but some days in between were more normal yet they still had such wide spreads...and well over priced options..
As I am not a trader with an account to sell options and take any advantage of that.. which is still high risk...and I think few people in spread bet companies would look to do... I think it seems rather manipulated and more or less makes it very unappealing to want to risk trading with them when they are so overpriced..
Is anyone familiar with US Index options on the likes of the S&P 500 or in my case I trade Dow Jones Wall Street options with Spread bet companies.
If there are any Option experts out there I wonder if they may be able to advise...
I have had some recent issues with a certain Spread bet company that I am looking into and IG index .... On August 25th I had bought some Wall st ? Dow Sept 17000 call options (and some weekly call options thru IG index)...and the market rallied over 500 points in 2 days..
I expected a reasonable gain of at least to double my money ...(on the Sept calls) (I closed out the weekly calls too early to recall the true valuations on a 500 pt move during that 2 day rally)
to my dismay.. these Sept 17000 Call options had hardly gained at all...and made just about 50% on what Id paid.
Many a time in the past Id easily doubled my money on a 500 point move..
Yet this was during the what seemed very volitile period over a few days and they were offering very little gain on these call options.
upon querying this.. they said sometimes option volitily is what determines an options value.
and in this case this is one of those instances.and they were not valuing call options very favourably.. I suspect that
still had a bearish sentiment...but the increaes in value of the call options seemed VERY undervalued after seeing such huge market moves..
I felt rather cheated and I had this happen in the 2007 to 2009 crash..where I was overpaying for options .. seeing HUGE moves and then getting little gains... basically they can alter the Vol so much that when a market has rallied say in a few hours to a day..then they devalue the volitility..
and the value of those options show NO gain..
As this very rarely happens.. its very hard to really know the realities of what such options may be worth under such conditions.. they could be telling me anything... or maybe the market makers are just creating unrealistic valuations.
I feel I need a real expert to be able to investigate this for me..and wondered if one had such querys is there any sort of service or company/organisation that could investigate such complex issues..
also so many times have I seen my account values when holding options just litterlly disappear.. on what seem rather small moves in the market of a couple of days..and when the market comes back to simlar levels.. the values of the account has halved.
to me its all so easy for them to get away with it.. and I don't believe that are valuing these options correctly.. in such times they can make any excuse.
They also have been making huge wide spreads on the options.buy and sell prices. as much as 4 to 5 time more..on daily options and 2 or 3 times on monthly Sept options...
Yes the market has had days of huge moves.. but some days in between were more normal yet they still had such wide spreads...and well over priced options..
As I am not a trader with an account to sell options and take any advantage of that.. which is still high risk...and I think few people in spread bet companies would look to do... I think it seems rather manipulated and more or less makes it very unappealing to want to risk trading with them when they are so overpriced..