How to avoid wide bid ask spread

[Nikhil_Wadibhasme]

Hi team,

Some less liquid options have wide bid ask spread. How to avoid or manage wide spread.limit order is one solution but if that leg is part of some multi leg strategy then there comes risk of not filing that order. Please guide.
@siva @nithin
Thanks.

[siva]

@Nikhil_Wadibhasme

Some less liquid options have wide bid ask spread. How to avoid or manage wide spread.limit order is one solution but if that leg is part of some multi leg strategy then there comes risk of not filing that order. Please guide.

Can you be specific about which contract you are facing above issue, I can able to guide you well in that case.

[Nikhil_Wadibhasme]

@siva , if you look at today’s deep ATM nifty 10150 call (expiry 12 March), its current LTP is 325. Nearest bid price is 316 and offer price is 343. If I want to buy then I will need to pay 18rs extra for market order to be filled that time only( since it is multi leg strategy I can’t put limit order and wait for it to be filled). Any solution to handle such case.

[nithin]

@Nikhil_Wadibhasme

if you look at today’s deep ATM nifty 10150 call (expiry 12 March), its current LTP is 325. Nearest bid price is 316 and offer price is 343. If I want to buy then I will need to pay 18rs extra for market order to be filled that time only( since it is multi leg strategy I can’t put limit order and wait for it to be filled). Any solution to handle such case.

hmm… unfortunately no solution to this. All you can do is place limit order and hope it gets filled. Always best to trade liquid contracts.

[Nikhil_Wadibhasme]

Thank you @siva and @nithin.
I will change my strategy to use OTM or ITM only.