/This is a sibling post to another recent posting - this particular question got lost. I have a bunch of shares locked up in another holding service for the next few months that I'd like to hedge (with collars) Unfortunately, no discount broker I've chatted with will consider equity held outside their account; thus any call I write is naked. (introducing all the problems of margin). Some advised that some full service brokers may be willing to do this - for a fee. Does anyone here know of a broker that has a means to consider equity held outside their own institution (with a fee no higher than $10k)?
How would broker X (where you're short calls) know you didn't later sell at broker Y (where you're long stock)?
depending on the holding service Goldman Sachs can handle it, unless there is a promise of future business they are unlikely to do it. your initial post doesn't explain why you want to or have to do it someplace else.
like everything it can be done if the numbers are large. on one hand willing to pay a 10k fee and then looking for a discount broker doesn't add up.
180 day post IPO lockout bans selling, but not hedging. Share transfers also blocked until lockout ends. Want to hedge as currently have a very concentrated portfolio in a single stock. (E.g. this is the same sort of thing Mark Cuban famously did with his Yahoo stock.. except his deal size was large enough for an ibank to touch) Only looked at discount brokers first from habit. Having grown up in the 90s, I never even knew full service was a thing until recently.
Why not just buy protective puts 3 months out and then do what you need to when you have full liquidity? Sure it costs you some money, but lockout period is the cause of that. I’m surprised you can do derivatives. I got laughed at when I told my old company that protective puts were bullish and they should allow me to do it. They were having none of it.
During the lockup period, Cuban crafted a synthetic index hedge (where Yahoo was less than 5 pct of the index). When the lockup ended, he put on a zero cost long stock collar. I don't think that Mark Cuban's approach applies to your scenario because I'm inferring that you don't have the wherewithal to do the synthetic index because you can't handle the margin of naked calls in another account. If you have a very concentrated portfolio in a single stock then covered calls won't do you much good as a hedge unless they are deep ITM and then you may have issues with early assignment and tax implications (Unqualified covered calls). I'd take a look at selling OTM bearish call spreads to fund a portion of the cost of a long protective put. No cost if you lower the put strike. Max out the number of call spreads with your available hedging cash (total cash divided by sum of call strike difference plus net premium paid for the 3 legs). After lockup ends and options expire, sell stock and/or collar as Cuban did.