Options with Tight Bid/Ask Spreads

Dec 7, 2013
3
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11
#1
Hi All,

Has anyone here developed a list of stocks/etfs with an options market that has consistently tight bid/ask spreads and if so would you be willing to share it?

To define "tight" I am looking for no more than 5% (preferably less) between the bid/ask in ATM options.

Cheers! :cheers:
 
Dec 7, 2013
3
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11
#3
Would have thought any exchange traded options would be that tight?
That would be nice but it is not the case. Few options have spreads that tight. For example, right now MasterCard (which has a moderately liquid options market) 13 Dec 805 calls bid:3.70 ask:4.85 - a spread of ~20%. And this is quite common.

It can make risk management very challenging.
 
May 23, 2012
32
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#4
Oct 18, 2008
4
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11
Washington
#5
Take a look at the "penny pilot" stocks (and etfs).
They are the underlyings where the options have a minimum tick size of 1 cent as opposed to 5 cents (or 10).

This is a good starting point, but you still need to do your due diligence, perhaps feed that list through another filter that ensures sufficient open interest and volume (ie, open interest > X and volume > Y).

https://www.cboe.org/publish/PennyPilot/PennyPilotClasses.csv

HTH-
 
Jul 8, 2014
7
1
13
#6
List of options with over 50k open contracts

Hi All,

Has anyone here developed a list of stocks/etfs with an options market that has consistently tight bid/ask spreads and if so would you be willing to share it?

To define "tight" I am looking for no more than 5% (preferably less) between the bid/ask in ATM options.

Cheers! :cheers:
This is a list of options with more than 50,000 open contracts. They are in order of open interest with SPY being the highest. Haven't gone through them all yet but should be a good list for swing trading.

SPY
AAPL
BAC
EEM
IWM
QQQ
VXX
SLV
EWZ
FB
FXI
MSFT
XLF
WY
MU
GLD
INTC
YHOO
F
C
GM
GE
EFA
JCP
CSCO
CBS
PBR
ABX
T
PFE
GDX
VALE
NOK
CMCSA
TWTR
JPM
BBRY
MNKD
EBAY
CHK
S
AA
XLE
USO
FCX
KO
PG
GILD
WAG
CLF
XOM
UVXY
WFC
XHB
AMAT
AIG
VZ
LNG
WMB
MS
QCOM
TSLA
SUNE
TLT
VOD
DIS
APC
NEM
EWJ
ORCL
MGM
HPQ
AAL
UAL
GRPN
WLT
IYR
MA
DAL
X
CX
HLF
UPS
COH
KMI
HK
DOW
BX
MRK
EMC
SHLD
WFM
TBT
RIG
DXJ
OPK
DIA
TEVA
NLY
BTU
DG
AMZN
DDD
CELG
HTZ
AUY
WMT
RAD
VLO
BA
HAL
CVX
CAT
ARCP
GG
AKS
UNG
SD
IGT
BMY
LULU
BRCM
SLW
MCD
BP
JNJ
SAN
GLW
OXY
IBM
XOP
LVS
BWP
P
HYG
IP
POT
MPEL
TGT
COP
CRM
SBUX
MET
MO
TPH
EPI
RSX
HSH
AZN
QCOR
SLB
ARNA
PEP
MBI
IRM
PHM
NUAN
TZA
GS
GTAT
GDXJ
NE
DHI
BIDU
TLM
BBY
ECA
FIO
TWC
NRF
SINA
UNP
DD
TXN
EOG
MYL
GOOGL
GT
SDS
USB
FOXA
SCTY
XLP
PM
SDRL
HUN
BRK.B
DTV
DISH
JNPR
SNDK
NFLX
VRX
VRTX
AGO
HD
LLY
ACAS
CCJ
XLU
WFT
VHC
DVN
APA
LO
SO
YOKU
AU
TMUS
AMTD
AVP
SNE
ANF
SVXY
CNQ
GMCR
MON
EXC
RIO
MRO
DE
XLB
NOV
KOG
BHI
EGO
OCN
SLM
CBSO
ARIA
FDO
CSX
XLI
XME
GNW
NVDA
SYMC
LOW
ACAD
GME
NRG
NKE
KORS
HES
AGN
BBBY
SPLS
AEM
LEN
V
XLNX
MOS
AXP
TNA
AMGN
ITUB
YPF
PSX
KBH
ACHN
MMM
FSLR
SFUN
MTG
XRX
AEO
CREE
XCO
MPC
ABT
BBD
CIEN
DHR
BKS
LINE
CIE
ACT
SGMO
TSO
HRB
JDSU
RAX
XLK
CTL
QIHU
PVA
RF
TRN
FTK
COST
YUM
BHP
YELP
KRE
GOGO
SU
IPG
WTW
MDT
LAMR
MNK
HIMX
TSN
UA
ESV
YNDX
ABBV
QLIK
JBLU
SPWR
WPRT
ERIC
TSM
WWE
CCL
NSM
MT
LNKD
COG
GDP
IOC
AGNC
PCLN
SBGI
FXY
ESRX
TIBX
UTX
EWW
ETFC
TWX
FDX
MDR
GIS
RDN
WYNN
XLY
UNH
ZTS
DB
ATVI
INVN
SMH
CL
XLV
ATLS
BAX
MRVL
NTAP
TSL
FTR
WU
QEP
MDLZ
CDE
NUGT
CAG
TTWO
NBR
IEF
GLNG
GOOG
TOL
FAZ
ADBE
SODA
ADSK
FAS
DO
ADT
RAI
SSO
UUP
PHH
CNP
HON
CSIQ
FEYE
ALTR
PEIX
NFX
MHR
SWKS
JIVE
VWO
BK
XRT
ODP
PBI
TAP
JOY
HIG
CBI
SVU
KKR
K
NCR
FXE
MTW
CONN
MDY
CVS
PAAS
HFC
CNX
STX
GPS
NEE
EXAS
NWBO
ITMN
JD
HCA
CLNE
KNDI
PRU
VMW
IBB
OREX
PETM
MAS
MWE
OIH
PXD
EXXI
BEAV
KRFT
CHL
EWY
BIIB
CTXS
CAR
ADM
WM
ISIS
BBT
EXPE
PNC
AFL
SPLK
LVLT
BCS
NUE
MTOR
SWY
ARUN
EA
AMX
LUV
SYY
DRI
ITB
DUK
PAY
CTRP
EMR
URI
YRCW
AKAM
MONT
NXPI
SWC
CHRW
UNXL
A
ED
LYB
LNCO
DNR
TCK
CME
ETN
PWE
SCCO
KBR
PPL
RFMD
NS
GPOR
COF
IR
AFSI
APOL
KMP
CCE
SNV
WETF
JASO
NSR
ONVO
ASH
ATML
CRUS
THC
SRPT
HBAN
M
UPRO
URBN
STI
EWA
APD
ACN
VIAB
YY
RGLD
EWH
AGQ
MNST
HSBC
KSS
IDIX
LB
PAYX
LGF
LBTYA
CTSH
CPB
PBF
CALL
USG
WIN
ENDP
EXPR
CMG
NPSP
AMBA
CDNS
NGD
CWH
WLP
APO
DANG
CZR
BSX
UPL
SCHW
WDC
CIT
STZ
SA
CF
NAV
CMI
SPG
IAU
FFIV
EDZ
KEY
FE
D
EUO
FIG
CAM
RMTI
MYGN
SWK
DFS
CBOE
DF
RPTP
SSRI
ETE
OPEN
JCI
FITB
GLUU
CHS
GGB
CLDX
HOT
RH
KCG
RRC
GSK
AG
COV
SE
NSC
TRIP
OUTR
DKS
NUS
CPN
RMBS
DGX
IBN
CA
LRCX
MSI
CTRX
KMB
FLR
NAT
JNK
KR
WEN
ROC
WHR
CROX
VIPS
NBL
EBIX
AMKR
GOLD
AOL
FAST
NES
HOG
EWG
DBA
JKS
SWN
BMRN
KING
ALK
KERX
AVNR
INFY
MAT
AEP
TEX
STT
WDAY
CI
AET
TJX
BYD
TER
HALO
 
Likes: Windlesham1
Aug 22, 2017
1
0
11
#10
That would be nice but it is not the case. Few options have spreads that tight. For example, right now MasterCard (which has a moderately liquid options market) 13 Dec 805 calls bid:3.70 ask:4.85 - a spread of ~20%. And this is quite common.

It can make risk management very challenging.

A way to avoid any worry about spreads is to choose a Strike Price and enter a random Bid/Ask PREMIUM of YOUR choice, beyond the given range, to your favour.

If you were SELLING a CALL, given your example, wanting the best price you can get, ASK $5.20 or $6.10. The price of MA has to rise to get your ASK Premium, if it does, and the MA Call Option gets SOLD, the range made no difference.

Conversely, say BUYING a CALL OPTION, BID $3.40 or $2.50 knowing the share price of MA has to drop for you to get the Call Option price you BID.

In either case, if you don't get YOUR bid/ask, move on, forget about it, try again tomorrow, try Selling NAKED PUTS ON TSLA as it tumbles, as Captain MUSK leaves the sinking ship. BE PATIENT!!!
 

Windlesham1

Active member
Jul 30, 2003
369
13
28
65
United Kingdom
#11
Stock options are terrible-use an index option- the index doesn't sleep with its secretary, it doesn't make shock announcements, or profits warnings that move it 30%. Only use stock options for fun,tiny trades.