Been trading options off and on for 20+ years, some of the time on the floor, some of it upstairs trading capital structure and vol. Most of the last ten years has been delta-1 stuff, but I took a couple years off and am now totally out of the loop. Will be trading liquid / volatile / fun stuff. AMZN, FB, TSLA, whatever. Will most likely be taking deltas, so I don't need all the bells and whistles. What I think I need right now: good matrix / order entry screen, with some configurable model parameters. I won't be hedging, but I'd like to not have to come up with my own useful vol numbers. TL;DR: pro options trader opening an account after some absence. Should I just open an IB account and be done with it?
Really depends on the volume you will be trading and the capital you will be depositing into the account. If you give us an idea, you can get some better responses.
Sorry, good call. Probably put $100k in. I anticipate (it's only that right now) I'll be clicking 5-lots, selling premium for delta. edit: meaning my volume is effectively zero--it'll probably be 500 contracts a month or something.
My personal opinion would be to start with a PM account with Think or Swim. They will want 125K to start, but after you open the account it can fall to 100k. They have some pretty aggressive promotions now giving free commissions for x amount of trades, (they will wave the ticket charge). Rates are negotiable if you find yourself doing more volume later. I know a lot of people like IB, it will be cheaper, but I think the customer service and platform is better with TOS. Other options, if you find yourself doing more volume, is using an introducing broker such as Eroom, Lightspeed or Victorsecurities. Rmorse posts here often and is associated with Victorsecurites. I'm sure he will be able to answer questions. With these companies you will most likely be clearing Apex, with the Introducing broker handling the customer service. Rates here will be cheaper and you will have your choice of many different platforms to use, but you may have to pay for the platform. Also the capital required will probably be more, around the 250k level.
I also agree that for an account of that size for options I would look at TD. for a larger account in the future, I'm happy to talk. Bob
Hi Bob, thanks for chiming in. By $100k I suppose I really mean "much closer to $100k than $1m". $125k is fine if there's a reason to do it. Are there still JBO deals and the like available? "Back in the day" I could take my $100k and get portfolio margin by hooking it up to someone else's BD.
I don't think I would go the JBO route. You will have to have the series 56 license. Your money will be locked up for 1 year. You will also have extra costs with this designation, (higher data fees, higher exchange fees). You will also not benefit with customer priority on orders. You will get similar leverage with a PM account. Their are advantages, but for most people I don't think its worth the effort. I actually have a JBO account which I am closing now. I use TOS as my secondary account. I like their charting software, their mobile app. Very easy to reach a rep if you have a problem or question. Most of their reps are former traders, who are very knowledgeable. Unlike IB, there is no auto liquidation. If you have a margin problem, it is dealt with by a person. I keep this as a Reg. T account, which has favorable rules when daytrading expensive options.
Easy to create single trades, spreads and easy to edit-in-place their parameters after that. Easy to see margin requirements. Great customer support for option traders. Conditional trades are possible. As far as I am concerned TOS meets all expectations of an option trader. As a matter of fact it's built specifically for option traders. That says it all.