In 4-legged spreads (butterfly/condor/box), the expiration of the long legs must be exactly the same as (and not after) the short legs. For a 2-legged diagonal spread, the later expiration on the longer leg poses no problem. But for a 4-legged spread the expirations must match. My question are: (1) does any broker allow a "diagonal butterfly", or does the restriction come from further upstream? (2) do you have any ideas about the motivation for not allowing this, despite allowing diagonal 2-legged spreads? As an example, the following is treated as two separate diagonal spreads rather than a butterfly: 1 Long Call @ $100 expiring in 1 month 2 Short Call @ $110 expiring in 1 week 1 Long Call @ $120 expiring in 1 month
Doable in TOS! Example: BUY +1 1/1/-2 CUSTOM SPX 100 (Weeklys) 29 JUL 22/29 JUL 22/15 JUL 22 [AM] 4430/4340/4380 PUT/PUT/PUT @30.00 LMT [TO OPEN/TO OPEN/TO OPEN]
That's surprising. I assume TOS means Think-or-swim by TD Ameritrade, which owns Charles Schwab (or vice versa, I'm not sure). And Charles Schwab will only margin the position I gave above as two separate diagonal spreads (confirmed online and over the phone).
Yep! Kind of silly, correct? Schwab now owns TDA (which has TOS), but the Schwab trading capabilities are vastly inferior for those of us trading multi-legged options, conditional, and complex orders! TOS is still alive, and according to Schwab, is not being discontinued. -- The commissions between Schwab and TDA side have not merged either! (options commissions differ a lot) --
Where do the options commissions differ? I see $0.65 per contract on both brokers, with no exercise fee.
When I last spoke with them, they were negotiating commissions to below 65cents depending on some factors, AND they were NOT passing on the Exchange fees for index products! (65 cents more for AM expiry and 54cents for weeklies)[in addition to the commission fee]