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>Schwab has some online spread ability, but I suspect there is still not
enough
>exchange automation to accommodate spreads in many of the traded names.
Schwab's online spread experience is no different from the experience
recounted here by another trader the other day - it is safer to place two
different trades at the prices you want if you need to get it executed at
around current ""spread" prices. No commission advantage either, in placing
spread orders.
Eg - you easily get filled on mid-point b/a both sides on individual legs of
a 2 legged spread, but unless your spread order is at the market, you won't.
Even if it is at the market, a spread trade fill report will be typically
12 - 15 minutes later than an individual side order fill report.
Even on covered call type trades, your fill reports are faster if you place
2 separate transactions (1 order to buy stock and one to sell calls) than to
place a single debit spread order. covered call trades tend to get filled
faster than option spreads at schwab, but that sometimes makes me wonder -
for very often I've been able to specify a debit limit, see the trade
through that limit for a good 3-6 minutes in a dense underlying+options
market, go in, change the debit trade to a 2 order trade and get a better
price.
So while it is good order-entry functionality to provide, the lack of
effectiveness destroys the purpose.
Finally, you can only enter 2 legged spreads at the current time so to do
anything else its a big additional variable feeding on the spread
interface's weaknesses. And the commissions are outrageous esp when one can
do the same somewhere else for half or a tenth of those commissions with the
same effectiveness.
THis in spite of Schwab having its own floor operation.
Gitanshu
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