Bid-Ask Spread

Use Option Alpha's 7 step option trade entry checklist to filter and scan for new trading opportunities.

Order entry is the most important aspect of options trading. Here are some tips to get trades filled quicker and with better pricing.

What is the cost of slippage? We focus too much on our commissions, but rarely do we realize how much slippage costs our portfolio. It’s time we stop worrying less about commissions and more about slippage by focusing on only highly liquid options and underlying stocks.

If you want to trade on a professional level you need to understand the importance of liquidity. The more liquid a stock is, the easier it is for you to get in and out of options trades with better pricing.

The bid-ask spread effects the prices you pay for an option. The "slippage" in the market is important as we continue to build on our understanding of why trading liquid markets is important.

Option pricing tables display multiple key components of an options contract such as expiration dates and strike prices, and can be customized to fit your trading style.

Liquidity allows option traders to enter and exit trades more easily. Securities with strong liquidity have narrow bid-ask spreads, which saves you money in the long run. Here are some strong liquidity examples.

Here is a detailed breakdown of Option Alpha's 7 step entry checklist for filtering and entering new options trades.