The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

Hey everyone, Kirk here again in optionalpha.com. Welcome back to the daily call. Today, we are going to be talking about liquidity concerns when you're selling options and three things that you can check really quickly as you’re starting to build out your trades. The first thing you have to understand is that as we build out our auto-trading software, we are going to be building in some liquidity screens or protections that are going to be in there, so that you don't ever end up trading or the auto-trading software ever ends up trading something that isn't at least more liquid than something else. We want to build that into our software. That’s something that we’re going to be doing as part of that roll out. When you are looking for trades manually and you want to check liquidity, there’s a couple of things you can check. One, just check volume and open interest. This is pretty easy. But you'll see either good volume that are open interest or not. You don’t have to say that it has to be above 1,000 contracts