Leaderboard

quick observation for anyone else plugging scenarios like the MS post above into the tool and getting different results. Note that by default the setting for Execution Fill Type is halfway between mid and market (and I think that is what is used in these samples), but I had changed my setting to mid market because the vast majority of SO trades I am able to open/close within a few cents of mid-point pricing. This had a huge effect on the %return when compared to what was in the article (mine was much higher). I would expect a bit higher but the result was much higher. This got me thinking Why such the big difference??? I came up with 2 thoughts: The tool is currently using end-of-day data, and I have noticed that bid/ask spreads at market close tend to be a little wider than what they are during market hours. When closing winning trades, the options with bigger gains are ITM by quite a bit and the bid/ask spreads for deeper ITM options tend to be quite a bit wider than those near ATM (especially at market close). What setting is best to use??? That is up to the user. But after many years of options trading I can safely say that the vast majority of my trades are filled within a few cents of the bid/ask mid-point (if I have to chase too far from the mid-point to open a trade, I typically don't open it).