I guess it's different from company to company? I am an account-holder with TradeKing, but am otherwise unaffiliated with them. Only trade with money you can afford to lose. Switch to another brokerage if they don't approve you. Kirk founded Option Alpha in early and currently serves as the Head Trader. I was hoping by investing the money I had with them and reapplying when I have a job this summer, they will approve me, but if not, I'm ready to move on to another affordable broker if there is the possibility.
Best way to get approved, most likely just change brokers. Interactive brokers has approved me for stocks, futures and all options with a minimum account of for students. Its your best call and they have very low structure fees.
Want to add to the discussion?
Pretty sure Scottrade classifies buying calls and puts as Level 2, as does everyone else I thought? Yeah I originally appealed the first time but was shot down. After that, I said "Okay well I will invest with them to show I'm serious when the times right. I'm with etrade and I was cleared for level 2 option trading right away. I can do pretty much any long strategy without margin which includes buying uncovered calls and puts.
I don't see why you can't get approved for that. The max loss is however much money you put in. I had never invested before but I said my experience was 3 years with stocks and 1 year with options. I included in that "experience" as classes and just a general following of the markets.
What got me really intrigued with options was my Financial Derivatives class my senior year in college. And in my appeal letter the first time I may have included a "max loss limited to money put in" argument. I also made it clear that while I wanted access to options, my account was going to mainly used for Stocks. It's quite weird that you are not allowed to buy calls and puts.
Yeah I'm starting to feel like when they told me that I couldn't have access and that other brokers one they mentioned I remember was TD Ameritrade wouldn't give me access either was just a crock of shit.
Is this a margins account? That is the only reason I could think of for you getting denied. Switch to another brokerage if they don't approve you. Most will approval you to at least level 2 calls and puts.
Just buying regular calls and puts. I'm not looking to write any or anything like that. A lot of brokers get scared because the OCC does random selections when options are near-the-money and close to expiration and then they force you to exercise the option random-lottery based. The broker can be liable if you were leveraging say AAPL, and don't have the equity to purchase the underlying. Best way to get approved, most likely just change brokers. Interactive brokers has approved me for stocks, futures and all options with a minimum account of for students.
Its your best call and they have very low structure fees. It is a good way to learn mechanics, but not a predictor of real results.
Actual options trading is very high risk and can lead to large losses for the trader. Only trade with money you can afford to lose.
Avoid paying market prices for options because the execution price may be higher than expected. Instead, name your price with limit orders and maximize your return. Reevaluate your strategy periodically.
Determine if there's anything you can do to improve your return. Learn from your mistakes, but also repeat your successful strategies. And keep your strategy focused; traders focus on a few positions, rather than on diversifying. You should have no more than 10 percent of your investment portfolio in options. Join an online forum of like-minded options traders. If you're dabbling with advanced options trading techniques, you'll find that valuable source of information and support, after some heartbreaking losses is an online forum of traders just like you.
Find a forum so that you can learn from the successes and, sadly, failures of others. Consider other options trading strategies.
Once you've accomplished some successful trades, you can get approved for more complex options trading strategies. This will allow you to more easily carry them out in real trading. One such strategy is the "straddle," which involves trading both sides of the market, buying a put and call option with both the same strike price and maturity date, so that you limit your exposure. It also runs the risk that only a single side will be exercisable.
A similar strategy is the "strip," which is like the straddle, but is a "bearish" strategy with double the earning power on a downward price movement. It is similar to the straddle in its execution, but with twice as many options bought on the downside put options. Learn about the Greeks. Once you've mastered simple options trading and have decided to move on to more complex options trading, you need to learn about the so-called "Greeks.
Delta - the amount an option price moves relative to the price movement of the underlying asset. An option with a delta of. Theta - the so-called "time decay" of the option price. It measures how much the price deteriorates as the option gets closer to expiration.
Vega - the amount the option price will change based on the volatility of the underlying asset. Is trailing stop the best exit strategy when you want to minimize losses on options?
A trailing stop is a good strategy to prevent losses when trading any security. It gives the trader the ability to profit from a trade until becomes unprofitable to a certain degree, at which point the trade closes. It is superior to a fixed stop loss in that it does not have to be reset each time the stock's movement direction changes. Whether or not it is the best strategy will depend on your position and market conditions.
Not Helpful 4 Helpful 9. Yes, if your broker is giving you good leverage. Leverage helps you to trade more quantity with less amount. Make sure you check with your broker about the leverage he is offering. Not Helpful 0 Helpful 0. I am looking for an options forum. Answer this question Flag as How do I know if I make money or lose money and how much? What are some examples of paper trading software? What's the safest and least painful way to get started? Include your email address to get a message when this question is answered.
Already answered Not a question Bad question Other. By using this service, some information may be shared with YouTube. Tips If you trade on margin, always be prepared for a margin call.
It is helpful to have a margin account if you want to sell uncovered calls or write puts. Otherwise, you can only buy options and write covered calls.
However, depending on the amount of cash and equities in your account, you may not be granted approval to trade on margin. Never trade with money you cannot afford to lose. Bunch of fuckin bullshit. The paradox is that they won't let you trade options unless you're experienced. Of course, it's impossible to gain experience unless they let you trade.
They want you to lie to them. Do they double check your application for truth or what? I might just say I am worth over k and that I have been trading options for 5 years. Last thing I want is to get in trouble over this shit.
I can't think of a better broker for small option traders, than Interactive Brokers. That's right, one single dolluh. It all counts in my book. But if you lose it all there is no one to blame but yourself!
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Jul 29, · A retail broker rejected me for buying options. Etrade just rejected me to buy options. I am extremely pissed off. I have about 19, dollars to invest and these assholes did not approve me for options. Plus, I'll help answer some common questions I get from members about either applying for a trading level to start with or moving to a higher approval level. Towards the end I'll share some tips and suggestions after talking with 6 different options trading brokers about new strategies or tactics you can use if you’ve been denied after applying for a . I recently tried applying to get approved for trading options in my brokerage account. I have 10k in the account ~$4k in cash and I'm I have more than the average investor's knowledge when it c.