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Mom-and-pop investors cannot take advantage of this (and many other opportunities) because they have to feed a long chain of middlemen through prohibitively hig
by gesman 11y ago
Mom-and-pop investors cannot take advantage of this (and many other opportunities) because they have to feed a long chain of middlemen through prohibitively high costs of trading as well as always being on the worst side of bid-ask spreads.
And then of course the value and the cost of high quality information delivered to you in a timely manner is a bit different than staring on CNBC screens.
- gaadd33 11y agoWhy can't mom-and-pop investors open an account at a place like Interactive Brokers and trade options on these events? The cost is pretty small per trade (maybe $1-2 for most stock and option trades) and the bid/ask spread isn't that bad if you are talking about an 11% move in a very liquid stock.
- s73v3r 11y agoBecause mom and pop investors have lives, children, jobs, bills, and the other stuff that demands their attention away from watching the stock market ever so closely.
- gesman 11y agoJust because if market does not move fast enough in the direction of their option trade - the value of their option investment will very quickly becomes ... $0.00 :)