Ok, so I have an account at optionsXpress with a trading level of 2 (means I can buy contracts/write covered contracts) can I enter into a straddle for example if I enter each leg seperately? (not using their spread trading) or am I not allowed to enter it at all? I called customer service and they didn't seem like they knew what was going on, they just kept asking if I wanted to try to upgrade trading levels. Thanks
My guess your low level was set by the amount of trading experience and knowledge you specified in your application...
Thats the WHOLE problem with this level business what if he needs to adjust his position by converting to a b-fly or condor...he can't:eek: Therefor the only "risk managment" he can implement is close the position most likely for a loss. He essentially can't do some of the safest/highest probability trades out there like calendars/b-flys. Brokers who limit the ability of the individual to properly manage their account are shooting themselves in the foot because they effectively are making it more difficult for their clients to succeed. They should allow options... or not...simple as that. If they allow clients to trade options than at a minimum allow all risk defined trades. Give your client the best chance for success.
Why don't you just ask them to review your account and upgrade the trading level? If you meet their requirements, I don't see why they won't let you do the more risky strategies.
Adam, I had an account at OE for over 4 years. I only traded occasionally, so it was OK for me. When I started getting more active this past January, I decided to check out other brokers. Subsequently I switched to Thinkorswim and I am NEVER going back to OE. If you go with TOS you will not regret it. They understand every question you ask them about positioning, time value, etc. Their platform is miles ahead of the OE platform as well. Don-
Just got my TOS account opened up today. Also have an OX account which will now be used as backup as a just in case TOS goes down and I need an emergency hedge or something. T.
Electric Savant had a thread on moving from OX to TOS... but I thought I'd throw this in here...a plug for TOS I trade in our IRA and people did ask me what would happen if for some reason I got stuck with an assigned short call that would put me in trouble and I said I didn't know. I do now. On Wed am when I opened my account before mkt open I saw at the top...Illegal 900 shares...ooops what was going on. I thought it might be that I had been assigned in GCI where I had a put cal on so IM'd the trade desk. Can't remember who helped me but he saw the problem was that short calls in WM had been assigned and I was left short 900 shares. He asked what I wanted to do and I said go ahead and buy them. I then noticed that my daytrade buying power had been reduced to 0 which meant I couldn't do ANY option trades...I immediately IM'd trade desk again and said ok as soon as the problem was cleared up would my daytrade buying power be restored...he said it is already and I noticed that 500K had been put in, which was far more than I had originally...but my problem was solved and I was allowed to adjust the portfolio at no inconvenience. Entire problem was resolved in less than 15 min and no they didn't let me keep the half mil the next day it was gone and my original BP was restored. In the weekly chat someone asked what their procedure was when something like that happened and they said they would try to contact the person by e-mail or/and phone before any liquidation or sale would occur.