Broker Option Trading Levels 0-5

Discussion in 'Options' started by robbo, Jan 3, 2013.

  1. robbo


    I have just applied to trade options with my tradestation account. They have given me the Level 2 rating which means I cant trade spreads. I need the level 3 rating to trade spreads. How much option trading do you generally have to do, to increase you level status or should I just open an account with another broker.
  2. umm i was with ETrade.. tell them you have been trading options for years and your income etc is high.. most people get approved.. its just bullshit red tape.. if you put 10k with interactive brokers you bypass this all together
  3. Just tell them to give you level 3. You can't even trade spreads? How lame is that?

    I honestly would recommend IB or TOS if you trade mostly options.
  4. Tos you will get killed in commissions trading 3+ legged spreads unless you are of a decent size and can convince them to relieve you of the ticket charge..
  5. I am at Tradestation, and it's not just about experience. It also has to do with your financial situation, as in liquid net worth. Even though it isn't all in your account there, they require you to provide the info to gain approval.

    I have level 4 and trade spreads mainly, the 4 alsos allows cash covered put writes. Level 5 is naked calls, which I have no interest in anyway. On a large co. with low probability for a takeover this wouldn't be much of a problem. However, imagine if you had sold some naked calls on Zipcar even 50% OTM, Bango you take a hit.

    I also have an account at Trademonster for Options trading, they have a nice platform, if you're trading multiple contracts or multi leg spreads, the commissions are better.

    Give them a check as there wasn't the similiar requirment as at Tradestation if I recall correctly. Minimum for an option account is 5K last I knew.
  6. robbo


    Glassinc, have you any idea whats the liquid networth tradestation is looking for before they class you as level 3 or 4, that is if you have the trading experience to go with it.
  7. No idea. Just filled out the info and waited to see. I remember asking someone and they told me, "If we told people that or more is what they put down to get approved."
  8. IB publishes all criteria that it uses, which I think is a better approach, although one could argue that it encourages lying.

    However IB's criteria are far higher then most.
  9. skk7963


    What do you mean by "relieve ticket charge" . I have decent sized acct with IB but I always pay commission as mentioned on their site. Is there anyway, I can negotiate with them to reduce the commissions etc. Has anybody done it , if so, what reasons do you give

  10. I was talking in reference to tos
    #10     Jan 13, 2013