steven_e

Let me add my praise for IB's generally fast executions, and terrific commissions. IMO, these two facts alone make the slightly clunky TWS and Option Trader interface worth putting up with. And IB's new Probability Lab looks very worthwhile. Thanks Marco for your explanation of adding or removing liquidity and how that impact the comm. I now understand how it is I could receive a credit for a trade's commission, which has happened to me periodically. I have been pleased with my average comm for RUT, consistently low (using SMART routing), ranging from 0.19c to a high of 0.79c, but mostly below 0.50c. Considering SPX comms average around $1.20, this makes RUT part of my portfolio mix, every week (and I like their Thursday expiries as well). btw, when I inquired of IB about commission breaks, they told me that once you hit about a $1,000 a month in comm, you can get a better pricing structure (details on the site of course), so there is definitely a better price structure for very active traders. Hard to believe IB's comms could get better than their standard pricing tier, but apparently true.

I too am interested in how to spot UOA (Unusual Options Activity), especially from brokerage software scans, as opposed to paid services. With Interactive Brokers (IB) market scanner, one can scan for Hot by Buy (or Sell) Imbalance, which could be useful data for directional trades. There are filters for Highest Volume and Highest Open Interest, and if you rule out those underlyings that always have highest vol and OI (Aapl, Goog, etc), the lesser known stocks that make those scan could be interesting trade candidates (with the caveat of being careful of lower option volume iunderlyings). As to how you would know if its an opening or closing trade, I do not know. btw, I guy named Andrew Keene, who was a floor trader, bases his entire trading strategy around UOA. His belief is that the institutional order flow should be mimicked, and that a huge buy/sell at a certain strike indicates non-public knowledge, and a tradeable edge.

selling naked puts for investors, allows an entry either at a lower price point than current price, or a profit from keeping the premium, if the option expires out the money. this way, an investor does not chase the stock price, but gets in at a point he/she has determined is favorable. margin required depends on your brokerage and the specific stock, with some momentum stocks costing more margin than a less volatile stock, at the discretion of your broker. margin can be reduced by buying a lower strike put, which turns the trade into a credit spread (bull put spread). This reduces the trade's yield, but percentage yield can be offset by more contracts, if one has a dollar goal for the trade