Bid Ask Manipulation

So you have a long dated spread on, have used a large portion of capital in your margin account and a super-wide B/A spread or low liquidity mark is reducing your net liq and using up too much margin. You can plainly see by looking at nearby strikes that yours is mis-marked, but your broker doesn’t and perhaps has generated a margin call because of this.
Manipulating market prices is not looked upon favorable by regulators, but if you place an order that you’ll take a fill on, then it is well within what is considered allowable.

I have found myself in the frustrating situation many times and here’s what I do to ‘improve’ the marks for positions held in my book. I’ll simply place a GTC order for the ‘mis-priced’ that will move either the ask or bid closer to where it should be trading. Your offer will appear on the trade grid and contract the B/A almost immediately. But if your offer is close enough to fair, be warned that it could fill and then the B/A will return to its previous place. So get close, but not too close. Be ready to get filled, but only a single contract is needed to have the desired effect.

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