Why are there such widely varying prices on the same option between different exchanges?
When you visit our website quote page at the following URL: http://www.cboe.com/DelayedQuote/QuoteTable.aspx, you will see different columns in the table after you enter your stock symbol. The first column is “Last Sale.” This column generates a great deal of confusion for investors new to options. Last Sale is simply the last price at which this particular option traded. For example, XYZ’s Jan 2003 120 puts have last sale prices from the different exchanges as follows: CBOE 41, AMEX 55, Philly 36.80. These prices occurred at different times at each exchange. These times could be up to a week or more apart. The next column is the net change. This is self-explanatory. The third and fourth columns represent the bid and the ask. The “bid” is the price where the buyers are willing to buy the option and the “ask” is price where the sellers want to sell the option. A person who is looking to buy or sell an option contract, should be looking at these prices and not the last price of which the
