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Forum Guru
 
Group: Administrators
Last Login: 8/25/2010 9:38:53 AM
Posts: 69,
Visits: 35
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| Question: How important is open interest and volume in measuring liquidity? Steve's Response: You should be concerned with the market quality and not volume or open interest. Liquidity is best measured by the quoted spread and size, and not by volume or OI. Volume and OI are just secondary indicators of liquidity. After all, your trades are against the quoted bid and offer. All FX Options quotes are widely available through your broker and through www.FXOptions.com/quotes.
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Forum Newbie
Group: Forum Members
Last Login: 6/2/2010 6:07:48 PM
Posts: 6,
Visits: 12
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Steve,
I guess the real question is, will we be able to get out a position when we want to? Will we be forced to hold on to a trade longer than we want to because we can't get out of it? Is our broker required to get out us out of our positions when we ask?
Thanks,
B
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Forum Guru
Group: Administrators
Last Login: 6/13/2011 7:57:49 PM
Posts: 54,
Visits: 375
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| Yes, you should be able get out of your position(s) without any problems. ISE has market makers that are obligated to continuously quote the product, thereby ensuring liquidity throughout the trading day. Your broker does not have a responsibility to get you in or out of positions.
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