IBKR Podcasts All the Single Options
Jun 10, 2024
Dmitry Pargamanik, cofounder of Market Chameleon and an expert in single option trades, shares valuable insights alongside Will McBride. They emphasize the critical need for data analysis in understanding single leg options, discussing how traders can gauge market sentiment through order flow. The duo explores distinguishing between single and multi-leg options, the nuances of trade execution methods, and the importance of a strategic mindset in trading decisions. Listeners leave with practical strategies and educational resources to enhance their trading skills.
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Break Down Option Volume To Find Signals
- Option volume must be broken down by expirations, strikes, calls and puts to reveal real activity.
- Ask what traders are doing, why, how it impacts markets, and whether there's a trading opportunity.
Start With Clean, Observable Data
- Collect raw observable data like time & sales, open interest, volume, underlying price and trade price before modeling.
- Clean, bucket and run models to compare averages and infer trader types from trade size and patterns.
Infer Order Flow From Ticks And Surrounding Strikes
- Mid-market prints don't reveal aggressor by themselves, so infer intent from pre- and post-trade ticks and surrounding strikes.
- Compare price and implied volatility movement across nearby strikes to determine likely buyer or seller pressure.