Options: Margins on CROX
section provides an interesting contribution on Margins Interactive Brokers, and TWS (Trader Work Station) posted in a mailing list to which they are writing. Officials with the permission of the author
Mauro
- the "margin requirements" can be considered as a claim that the Options Clearing Corporation grants to encourage the exchange of options, according to a code of regulations (Reg-T ) that the brokers agree to pass on to their customers. Obviously, this "credit" applies to those who made the request at the time of registration, and not for those who has established a regulation for "cash";
- margins are strategic comfortable especially in the case of sale of an option, that having risk margins tending to infinity, it can take a lot of money in the account to cover, especially if not accompanied by a similar option to buy, how in the calendar - you can check the cost in terms of margins of the execution of each leg (not the combo) by right-clicking on the order line to be transmitted (the one that is still the "T") and just selecting "Check Margin". For the combo you should use the other voice "What-If", but I've never understood how it works, and if anyone knows anything, his explanation is welcome;
- in the terminology of IB, this cost consists of a change in "Maintenance Margin", which roughly measures the current level of risk exposure. Because the operation is eeguibile, it must be that this parameter is less than the '"with Equity Loan", but that more broadly measure the capital currently available. This difference appears in IB under the name of "Excess Liquidity" and must always be positive, not only after each transaction, but especially within the Italian 15:40 the next day, a term beyond which IB will make a liquidation of the portfolio until that this difference does not return to positive
- is still a sufficient positive balance of even a few dollars, I have a few months ago I get by a week with a balance of $ 112, obviously without being able to buy a lot because I lowered the 'Equity with Loan "I got up and sell the" Maint. margin. " In practice, the only operations allowed in this case are the repurchase of options sold (to lower the "Maint. Margin") or the resale of options already in the portfolio and dry, that is not linked to other options sold, which would otherwise remain uncovered back the starting point. It is therefore not true that we have the $ 2000 of which someone else has spoken, and I think they are only required to open an account from scratch. There would be other things to say, account management and other items that need to be careful, but I hope however, have contributed to a bit 'of chiarezza.Concludo with a little trick that is very useful to me: TWS allows you to constantly keep an eye on some important parameters, as well as the price of the shares that concern us most.
Just go to Configure -> Global configuration -> Trader dashboard -> Add Account Data (or Symbol). To view, you should then be in Site -> Trader dashboard -> Show.
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