Sell Options on Futures

Most brokerage firms restrict, hinder, or forbid option sellers. At DeCarley, we embrace them.

If you are a responsible option seller looking for a new home, you’ve come to the right place. DeCarley Trading is highly experienced in handling option selling customers, and we work tirelessly to provide our brokerage clients with a friendly Good broker is the missing piece to the puzzleenvironment to conduct their chosen trading strategies.

We take pride in offering an efficient mix of low transaction costs and exceptional service to those participating in option selling strategies because we know how important being with the right brokerage firm can be for such a market approach.

10 benefits enjoyed by DeCarley Trading option selling clients:

  1. SPAN minimum margins on ALL products – DeCarley option selling accounts receive exchange minimum portfolio margining regardless of the markets traded. Some brokerage firms implement an “up-charge”, in which they require a percentage above and beyond the exchange minimum. The difference in margin requirements can help in avoiding margin calls which can be a nightmare for a short option trader.
  2. Trade both futures and options side-by-side and in the same account - Some commodity brokerages (and broker-dealers) require their clients to separate futures positions with options trades. This prevents those traders from efficiently hedging their risk and lowering margin accordingly. For instance, a trader who is short a call option in one account and long a futures contract in another faces no upside risk and unlimited downside risk. The net SPAN portfolio margin accounts for this reduced risk exposure but a trader forced to execute the positions in two different accounts is fully margined on both sides of what is essentially a spread. 
  3. Offsetting margins - The SPAN margining system ensures traders are not charged option on both sides of a strangle or straddle. Instead, the risk and, therefore, margin requirement, is netted to reflect the fact that a trader can only lose on one side of the trade. 
  4. We don’t spike margins above exchange minimums during times of volatility.
  5. We don’t interfere with your trades unless it is the last resort (uncooperative to margin calls, or in danger of losing more than is on deposit) - Unlike many discount brokerage firms, which sometimes take the liberty of liquidating short options without notifying the client, we work with you to adjust margins, or if necessary, give you time to wire funds. We have spoken to clients of discount firms that experienced premature forced liquidation of short option trades by overzealous margin clerks. A single instance of this nature could result in thousands of dollars in unnecessary losses.
  6. Sell options naked, we won’t force you into credit spreads, or unwanted adjustments – Some brokerage firms require clients to convert naked short options into credit spreads regardless of the margin situation. If your account is well-margined, and your option selling is reasonable, we will not force you into trading credit spreads or any other unwanted strategy.
  7. Sell options in an IRA account without any additional restrictions, or higher margin requirements – Many brokerage firms charge higher margins to their IRA trading option sellers or limit them to trading with a small percentage of their commodity-allocated IRA balance.
  8. We are capable of quick and efficient order placement of short option strategies – Even online traders will need assistance from time to time, and we do it without any additional cost to the client or desk fee. Many brokerage firms charge their online clients as much as $60 round turn for phone orders.
  9. Access to experienced staff members nearly 16 hours per day – We are personally available by email and phone throughout the trading day, and well beyond. We check and respond to emails persistently to ensure everything is going smoothly for our clients.
  10. Trade guidance and recommendations – We offer newsletters with option selling ideas and guidance and can offer personal support to individual option sellers.
  11. Margin call management advice and adjustment recommendations – Margin calls can happen, even to the most responsible traders. We help our clients adjust their risk exposure and margin, without necessarily liquidating positions or refunding the account.
  12. We have direct access to trade desks to execute trades during times of platform failure or technical issues.

If you are interested in pursuing the possibilities of option trading with DeCarley as your broker, we’d love to hear from you.

Futures and Options Trading Booksby Carley Garner

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