Good morning, I am a client of Interactive broker. I am long the ES future contract (sp500) and I am short with a put on the SPX index. The 2 positions have the same value. There is therefore no market risk according to management. However IB asks me for a margin for the 2 positions. I had read on the CME website that the SPX options positions compensated for the ES future contract but that does not work for me. I wanted to know if this worked for you with your broker. Of course, as I am French, I cannot choose all the brokers in the USA.
You’re asking for Cross margining which does not exist for retail accounts. One is regulated by the NFA/CFTC and the other SEC/FINRA. You have two margin requirements with no offset. This is correct.
%% IT works well in theory. But sometimes stuff happens, one Monday, metals dealer did not open; + tuesday good gap for the sellers. Different markets, but principle can be the same. May NOT happen again, but both both longs + shorts lost lots in 1987. In theory, both should not have lost. but both did. Unusual number blew up. WE do know IBKR strangely lost a lot of profits in options, so really cant blame them if they get more margin than most. ES is super liquid, usually .
How about you buy an ES put on the same contract month and see if your margin changes. You do realize that long an ES contract and long an ES put is the same as long an ES call. You save on commissions and spreads by just buying the ES call.
Why the hell would you sell an option of an index on a future that has been going up for 5 months? Masochistic, or pure idiocy?
Thanks for the answers and ideas. I have one more question which may seem simplistic. Does the ES future contract have exactly the same progression as the SPX index or SPY ETF? If I buy the spy today and sell the future contract in June 2024 in the same size, the position will have gained or lost nothing when the contract expires in June 2024? I don't think so otherwise he would have a winning arbitrage on the options. I have the impression that the future contract decreases more than the spy or the spx.