Options and bonds in one account?

Discussion in 'Retail Brokers' started by BMK, Aug 16, 2020.

  1. BMK

    BMK

    We have a core portfolio that consists of exchange-traded products and bonds. Not bond funds. Not bond ETFs. Corporate bonds and municipal bonds.

    We also trade options. Mostly spreads with finite risk. We are approved for the highest level of option trading, including naked calls and puts.

    We want to keep everything in one account, because we like to have the equity of the bonds and ETPs available for margin on the options trades.

    We are currently with Schwab. Option trades are 65 cents per contract, and bonds are $1.00 per bond. That means $1.00 for each bond with a face value of $1,000. So if we buy $10,000.00 worth of bonds issued by Best Buy, the commission is $10.00.

    We would love to move to a broker with lower options commissions. But every broker I have looked at that has lower rates for options either does not offer bonds, or the commissions are just outrageous, e.g., as much as $25.00 per bond.

    Schwab has a very good online platform for reviewing the bond inventory and placing orders. It seems like many of the smaller brokers don't offer an online platform for retail customers to buy bonds. You still have to "call the bond desk," and you are effectively paying a full-service commission. Feels like it's still 1998.

    Anyone have any recommendations for a broker with reasonably low commissions for both options and bonds?

    Schwab's commissions on stocks and ETFs, like many other retail brokers, is now zero. But we could live with a $5 or $10 commission on stock trades if we had better rates for options and bonds. We don't trade stocks very often. We don't buy bonds very often, either. We buy and hold them 'til maturity, usually between a year and two years. But we're not going to pay a $375 commission to buy $15,000 of corporate bonds. It's ridiculous. BTW, we're in the USA.

    BMK
     
    Last edited: Aug 16, 2020
  2. ids

    ids