IB does have options on futures on the ES. It is not only an advantage for overnight trading, I believe ES future options have better margin requirements (SPAN) from what I have heard. The b/a spreads also seem tighter than normal SPX spreads but the ES options are 1 point = $50. So if the premium is 1.00 it is really $0.50. From what I have seen, you may get a better partial hedge from the ES options than SPY (still waiting on mini-SPX) but I personally had problems with IB and it lost my trust so it is hard to go back... If you trade in large volume, TradeStation is cheap for options ($1.00 per contract) and if you trade enough the platform is free. I think 50 spreads would qualify. I am using them for futures trading. But at $1.25 a contract at ToS v. $1.00 at IB and all the same tools but better customer service, I have been happy with ToS and OX. Only downside is no access to futures options BUT ToS has said they are considering it and actually want to bring those products in. Phil
When you call Scott, like I said, mention my name and this thread. Others here may also get the lower commission rate. I have chatted with Scott (founder), Joel Blom (President) and Tom Sosman (founder) and they are all option traders and very active in customer service. I think you will like ToS and the fact that you can do stress testing on your SPX portfolios and see the effects of SPY hedges on your portfolio, even with changes in the underlying index and volatility. Phil
I didn't even realize they went sub-$1 on those cheapie ops. For only $0.50 or $0.25 it could pay to close some of those OTMs you may drag around till expiry, just because you want to aviod the commish hit. Might miss some nasty surprises occasionally. Or even go the other way and load up on some OTM longs if you want to roll the dice. Why not, at 50 cents or a quarter commish...
I just received confirmation that the deal is as expected (i.e. no minimum number of trades required and access to trading desk). I also asked about options on futures. Scott replied that they are "still some time off" for options on futures because they can't be cleared under Penson (their clearinghouse or whatever it's called). He said they are working to change this.
Yeah I have learned that what brokers can offer and how they offer it depends solely on their clearning firm. Even though the ToS crew wants to do options on futures and worked hard to get futures added, Penson will not let them do futures options yet. At OX, they allowed E-mini trading but only for individual accounts, not accounts in the form of an entity, and the reason was not their requirement but Goldman Sachs, their clearing firm. I truly hope that ToS adds options on futures next year. Phil
TOS's "Liquid" platform for institutional traders is as good as anything I've ever seen. Unless of course you happen to be a DPM and need something like Microhedge. It has bit more advanced functionality than does their retail platform. Also it's not bound to their clearing firm which is Penson. One can use ones own FCM and B/D and do the give up. They've built this for intuitional traders that have their own relationships on the street. This way you can keep your own existing comms, soft dollar, trading structure, whatever and then just pay TOS an execution fee. Your FCM, B/D, JBO, still gets their part of the fee.....everyoneâs happy. Pretty sweet. http://www.tosliquid.com/
Riskarb I find your suggestion extremely interesting. Please expand: Would you adjust? when and how? If you feel like the SPX is rangebound would you open the Call side? Would you wait for a "bottom" to open the put side? "top" for call side? Any "hints" would be appreciated. Ckor
The one neg on IB I heard, but may have changed, is they charge for xled or to change your order. as a woman I'm prone to change my mind so I like the fact with TOS I can xl or chg my order frequently...probably drive them crazy