Murray: Spoan margin could just be a prettier blade to cut you with. My advice is to never open credit spreads or diagonals who max risk is greater than your account balance and then it really will not matter SPAN v. Reg. T and that might be the best policy for those IRA accounts. However for diagonals, ES rocks due to ES and EW choices and better fills per b/a spread compared to SPX. I take advantage of SPAN and the haircut for the ratio spreads but I can roll it into a bear put spread or butterfly for a limited risk position even if doing so takes a nice loss (like rolling SPX credit spread into Prego Fly). SO I know that even if the position gets away from my, I still have chocies to lock it down without blowing up. For IRAs follow my rule above and it is not an issue. But you will find the ES spreads might work better and provide more flexibility
Coach, As far as selling back month Premium against short term Month, is you are playing VEGA as you suggested, but you have a much longer time frame to be right in the trade, unlike month tomonth credit spreads. If you look at a chart of the VIX, history shows that most increases in VIX last for very short periods of time. Usually measured in days, not months. Therefore, a DEC, premium decay position gives you plenty of exit points. Remember, only a slight decrease in VEGA wildly effects the DEC back month position. Check out the intra-month spikes, ie yesterday. http://www.ivolatility.com/options.j?ticker=SPX:&R=1&period=3&chart=02&vct=4
Phil, Our thoughts were to move IRA's to SPAN margin, and Cash accounts to 'Haircut'. With the haircut margin we could still trade cash index options.... volume and liquidity advantages? Your thoughts? Thanks. M~
I follow you. I just need some downtime to actually look at a position and see what the credit would be to roll the AUG to OCT or DEC for the reverse calendar and the potential. Reverse calendars are new for me so have to study a little.
Possible accounting nightmare? IB has book management within the advisors accounts. V-trader would be one single entity and a ton of book keeping.... but I guess outside third party software is available.... Have you gone through this decision process when dealing with your 'other' account managements? M~
You're right Coach, if the strike has no action, you wont get filled and this is what im experiencing at the moment. Good learning experience for me. Guess the thing is to look for strikes with higher volume traded or open interest. Wish it had the same volume as SPX.
Just want to say I have yet to find a strike I have been intreested in with so litlte action that I do not get filled shaving a tick off the bid or ask for ES.
I think you can divide it like you are saying with IRAs at IB and cash accounts at VT. Just sweep profits regularly unless you really need the capital account buildup to trade bigger. I still have my ToS account where the prop money came from and if I want to sweep money but do not need it in my hands at the moment I am going to sweep it to ToS for safe-keeping .