Qcharts options alarms (bbid, bask) versus optionsXpress

[AllieF]

I have posed this question to optionsXpress VirtualTrade support, but they are pretty useless.

I set myself a target options price to sell options at a specific "best bid". I have had *many* occasions where qcharts alarms on the target price - sometimes multiple times in early morning, but a pending sale order at optionsXpress VirtualTrade does not get filled at that price (orders are GTC with a price limit).

My hypothesis is that optionsXpress VirtualTrade is only honoring bid and ask prices, rather than best bid and best ask. But I don't want to risk real money finding out if this is the case until I understand for sure what the difference is.

Has anyone else experienced the same thing and do you know the nuts and bolts behind these two different behaviors? Are real money trades going to get filled at best bid / best ask prices?

It would be a tremendous help to figure this stuff out.

EDIT: If you know how qcharts options bbid/bask quotes coincide with any other trading firm using real money, that'd be good to know too!

[tradertom]

Hi AllieF and welcome to the board!

I use OptionsXpress "Streaming Quotes" for real money trading and the quotes displayed are as quick as I have seen. Using Streaming Quotes, I can get limit orders filled exactly as I expect so those quotes and fills are pretty dang precise in my experience. It is a java app. Try it. Select Streaming Quotes from the bottom of any OptionsXpress web page and play around (just don't click Preview Order or Speed Trade because these are real-money trades! Leave the quantity blank for safety.)

In Virtual Trading, however, the story is very different. I don't think it is a matter of best bids and best asks, I think the system just doesn't work correctly. If you enter a new trade with a limit order at or above the displayed bid, Virtual Trading will fill it no problem. But if you enter a limit order below the current bid, the order might never get filled, even if it falls to your limit. Same with limit orders to exit trades. It seems like they sometimes hit and other times they don't.

So you are not alone in this. I do not know why they cannot get it together with Virtual Trading. I believe it is just a low-priority system that gets no attention from OptionsXpress but there is no sign that they are willing to improve it or even admit that it is a problem! (This is a familiar story here.)

As for QCharts BestBid and BestAsk quotes, I find they are not so accurate even on the v6 feed. I use them just to get an idea of where the position is but with option prices, they skip around and are often delayed on faster moving stocks. I never use the QCharts quotes when making decisions to enter or exit trades; I use Streaming Quotes (you can see the difference watching them both as they change.) For doing practice trades, you can use QCharts Option prices with an alert to tell/email you when the order would have been filled, using the "at or above" or "at or below" selections and the correct field for your trade (bbid or bask). Not ideal but more useful than OX Virtual.

Tom

[carbuff]

I was under the impression that optionXpress's virtual trading only "executed" a trade for you if there was an actual trade made above / below your limit price as appropriate.

In other words, just because the Bid or Ask hits your price target, if there is not an actual trade there, the virtual trading system won't 'execute' your virtual trade for you.

[tradertom]

Hi carbuff,

If that is the case, then the OX Virtual Trading system is definitely not working! There is no waiting for someone else to buy at my limit ask price before my order gets filled in real money; Virtual should not either. They have all the bids and asks and it seems fairly simple for them to use the bid/asks to fill versus an actual trade at that price. Sort've rules out practicing on anything except MSFT, GE, and other massively traded instruments... In any case, I hadn't heard this but it explains why Virtual missed so often on option limit orders, except if your limit is at or above the ask (or at or below the bid) it gets "filled" immediately.

I have spoken with them numerous times about the problems with their virtual trading; specifically with trailing stops and I get conflicting messages from them. I stopped using their virtual trading and now just use QCharts Alerts to send me an email to record the paper entry/exit. It works better than OX but is not ideal...

Tom

[carbuff]

Gotcha... I thought I had read that somewhere, it's one of those little pieces of information that sits in the back of my brain and pops up when jarred. I could well be wrong though... I know it would jive with some of my experiences with their virtual trading, but I haven't attempted to use it in a while...