Remember about seven or eight years ago when the bid-ask spread in a typical option contract was so wide you could drive a proverbial truck through it? When I was a market maker on the CBOE trading floor back then, most of my bids and offers were around 20 cents apart. I must say, it was a good time to be a market maker.

But as the late George Harrison once said, all things must pass. Changes in the industry forced markets tighter and tighter. Market makers had to take on more and more risk for less and less reward. It got to the point where the options market was more liquid than the underlying market (this is still the case in some securities options). That is when I left the floor and stopped being a market maker in favor of trading as a market taker. And I wasn’t alone. Lots of traders left the floor at that time. I believe it is still a great time, comparatively, to be a “retail” trader.

But tight markets aren’t the only benefit of this exodus of professional traders from the trading floor. A handful of ex-market makers–present company included–have moved into option education. Now anyone serious about learning options can reap the benefit of years of experience from the trading floor.

When my peers and I were learning options, formal education administered by professionals was not commonplace. We had to earn our education in the school of hard knocks–on the trading floor–and the price of success was often high. Now potential traders can arm themselves with formal option education from an ex-market maker and learn how to avoid costly and painful trading mistakes.

I encourage my readers to visit my Web site,, and consider the benefits of personalized one-on-one option mentoring from a floor trader.