any idea about future option margin

Discussion in 'Options' started by trader198, May 30, 2012.

  1. I entered a put crude option in my paper account. i found it needs margin. stock options if long either put or call do not need margin. I am testing future option, I hate to trade with stop loss in future.

    I am planning to buy 87 put, and 85 put, looks crude will hit 80under pretty soon

    that is reduculious!
  2. TskTsk


    Future options use a different marginining system than stocks. (SPAN margin) and the margin is not fixed. It may take $1000 to open a trade but that margin might increase to $5000 in a couple of days depending on what the underlyer does, so watch out for that.

    IMO it's still a much better system than standard margin.
  3. that makes sense. no wonder I noticed my margin requirement
    changes when my option moves.

    that sucks. I just want to take advantage of the leverage. looks I can not do that because of margin.

    bought some airline call options, look better than crude put option. no margin. I do not need worry about margin call and in order to avoid that, I need a stop loss, that makes me hard to trade. I do not use stop loss.

  4. jys78


    What broker are you using?

    For LONG futures options, there should be no "margin" requirement - you pay the purchase price in cash.

    For SHORT positions, look at the margin requirements associated with the underlying.
  5. theoreticaly there should be no margin requirement if long either put or call.

    I am with IB. later I found the margin is moving, actually equals to nothing, will not trigger margin call. I bought 87 put and 85 put, when my put is in the money and deeper, the margin goes up, but when my put is out of money (just suppose, I did not see it, my 85/87 is deeper in money after friday's freefall), margin is reduced. I guess if my put goes to zero, the margin may be zero.

    what I do not understand is why this kind of margin, does not make any sense.

    IB really sucks in this matter, particularly in friday experiation, that is the best time to trade option, they post margin requirements after 2:30PM to stock options, they suppose someone bought and hold till option execution, caused potential margin problem. someone may bought 1000lot aapl...

    the last 2hours are the best time to make killing easily, but they forbid this. sucks.