[In Tuesday's Team Trades we discussed a trade on the QQQ] Were you trying to put on a spread or buying or selling puts? What does 5.60 by 5.80 mean? If the market makers moved bid to hit stops were these people selling puts? I always had to buy at the ask and sell at the bid. (August 22, 2001)

  No, that was the bid and ask (5.60 x 5.80, a 20 cent spread). What happened was someone apparently put in a limit order to buy the puts at 5.80, trying to shave the spread, and the market maker moved the bid up to 5.80 while keeping the ask at 5.90. That narrowed the spread and we knew we could get the ask pretty easily even if there was upward pressure on the QQQ. We wanted to get in on at least one position, so we put in the second order at the 5.90 price. Then when the market ticked higher, the option prices fell and the second limit order was triggered. We were just using the market maker's tinkering with the spread to get a quick fill. When they narrow the spread by raising the bid, we can usually get a fast fill at the ask price even if there is upward pressure on the option and it would normally rise on the ask. Seems strange, but that has been our experience.


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