Strange ONE to IB combo order issue

Discussion in 'OptionNET Explorer' started by CC, Feb 2, 2018.

  1. CC

    CC Active Member

    Hi,
    I can't send the following order from ONE to IB:
    SPX
    2725 buy 8
    2720 sell 8
    2715 sell -10
    21710 sell 10

    It's because IB expects the "simplified" version of this trade.
    (Ie: 4/-4 -5/5)
    So, if I put in a 4/-4 -5/5 trade in ONE, I can send it to IB...

    I don't have this problem with other complex orders.
    (ex: 10/-10 -20/20)
    The order is simplified into 1/-1 -2/2, and then turned into 10 orders.

    Anyone else encounter this issue?
    Thanks!
     
  2. ACS

    ACS Well-Known Member

    Apparently ONE was paying attention in class when least common denominators were covered.
     
  3. stevegee58

    stevegee58 Well-Known Member

    What you're seeing is coming from IB, not ONE, also it's not a problem. IB wants the ratio to be a simplified fraction so IB doesn't like 8/10 but does like 4/5. So you create a spread with 4/5 ratio and buy 2 of them. Find the greatest common factor then divide the numerator and denominator by it.
     
  4. CC

    CC Active Member

    Thanks! ONE fixed the issue for me. Awesome service on their end.
    IE: 8/10 ratio trade is sent as two 4/5 ratio orders to IB

    However, I still can't put the trade through IB.

    I asked IB support, and they wrote me:
    "The rejection message you receive is not related to permissions. It is related to the fact that the non-standard SPX spreads you are trading will not be booked electronically by the option exchanges. We cannot override or change this. You can consider breaking these spreads up into multiple orders.
    The exchanges will only electronically book Opt/Opt combo's with a ratio of 3:1 or less, with max legs of 4:
    LegRatios
    1:1 1:2 1:3 2:3 1:1:1 1:2:1 1:2:3 1:2:2 1:1:1:1 1:1:1:2 1:1:2:2 1:1:2:3 1:2:2:3 1:2:3:3 2:2:3:3 1:1:1:3 1:2:2:2 1:3:3:3"

    So I have to put in the 4/5 unbalanced condor orders as 2 spread trades on IB...
    Is this ratio that uncommon? Can it be done on TOS?
     
  5. ACS

    ACS Well-Known Member

    An 8 lot condor and 2 lot vertical may have a little less execution risk than trying to fill 8 and 10 lot verticals at the same time.
     
    CC likes this.
  6. CC

    CC Active Member

    Thanks! Was just hoping I could put it through as 1 trade. :)
     
  7. status1

    status1 Well-Known Member

    Hmmm.., That's interesting
    I just stumbled upon this post and I remember a couple of moths ago when I was trying to place a combo that was rejected I am guessing it's probably because it's a crummy brokerage and the rejection was saying that they don't except ratio spreads but now I am thinking maybe it's because it wasn't one of these specific ratio spreads

    I was wondering if there exists a list that shows exactly which ones are accepted for SPX or is that list shown the complete list ?
    I see the 1:2:3 but I don't see the 1:3:2 in that list Is that because it's not allowed or because it just missing from the list ?

    I believe in TOS you can place almost any kind of trade and they will take it It may not necessarily execute because the combination of bid ask spreads are unpredictable but at least they will take the order
    Even a simple roll of a spread they take it as one condor and internally split it into a closing and opening order and most of the time it will execute as one order while other brokerages they don't take that order You have to do 2 separate orders
    So you have to close one spread first than place another order to open a new one
     
  8. ACS

    ACS Well-Known Member

  9. status1

    status1 Well-Known Member

    Symmetric butterflies are usually not a problem getting them placed and filled
    It's when it's asymmetrical or BWB is when the brokerages start having problems
    Outside of TOS and perhaps IB I don't know of any brokerage that can properly handle BWB trades in one order
     

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