Most active time in US?

[storchyman]

Does anyone know what the most liquid time usually is in the US Options market?
This info should help minnimise price gaps in spreads

 

[Richard Dale]

Does anyone know what the most liquid time usually is in the US Options market?
This info should help minnimise price gaps in spreads

Based upon the data from CBOE here:
http://www.cboe.com/data/IntraDayVol.aspx

The most liquid time is towards the end of the time.

Here are the percentages of total volume by 30 min segments (in New York time):

9:30-10:00 1.6
10:00-10:30 3.1
10:30-11:00 4.1
11:00-11:30 5.4
11:30-12:00 6.4
12:00-12:30 7.3
12:30-13:00 8.2
13:00-13:30 8.9
13:30-14:00 9.4
14:00-14:30 10.0
14:30-15:00 10.6
15:00-15:30 11.9
15:30-16:00 13.0

As you can see, it really starts to pick up towards the end of the day. The open is relatively quiet.

 

[emilov]

And the reason for that is the old saying that beginners open the market but pro's close it. Every option trader knows to start looking for trade entry signals one hour to 30 mins before closing. Only during that time we can see how the market is likely to close. If you get in in the morning you might get screwed over during the day.

This is the general rule which I and most option traders I know follow. An exception would be a stock that you missed. When it opens the next morning (after the 1st hour of trading when most eager buyers are through) you might consider getting in if the entry signal is still there (and everything else matches). I've had a profitable trade once or twice like that.

Cheers, Emil

PS. Thanks for that info Richard! Although I don't trade the US market (I do value my sleep) it was educational

 

[storchyman]

thanks for the info