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yes, your broker can exercise the long option if need be. If you read over your options agreement & margin agreement you're required to sign to trade these I'm sure it's in there. If you had a long put to offset your assigned long position and the broker was to liquidate at a price below the...

why would the broker liquidate the long option to meet the margin call and not exercise it for the client? if you don't have sufficient margin to maintain the assigned long or short position and it's liquidated for a loss, how are you going to have sufficient margin to exercise the remaining...

FINRA rule 2520 states that the only spreads allowed in cash account are European Style cash settled. If the put spread owner is assigned on the short leg, he'll end up long the underlying stock can either liquidate the stock to close out the assigned position or exercise his long put to...

crook. kidding, what you said makes sense.

yeah, there is risk involved but it goes with the territory and it's their job to manage that risk. Not just their delta, but their gamma too, etc. yes they will short the stock. Generally the get an exemption (or at least they used to, not sure if they still do) on naked short selling so...

here's some excerpts from FINRA rule 2520: (M) Cash account transactions — A member may make option transactions in a customer's cash account, provided that: (i) The transaction is permissible under Regulation T, Section 220.8; or (ii) Spreads. A European-style cash-settled index...

spreads are allowed in cash accounts only if the underlying are European style cash settled.

a margin account is not required for cash secured puts.

yeah, should be the naked requirement

what kind of price improvement? any different than what the BOX or ISE gives? I'd be really suprised if IB wasn't selling their order flow as well, just about everyone does

damn, that could add up quickly for active traders. do they rebate back some of those fees if you do enough trading? when would it be 2.10 rather than .10? depend on # of contracts?

how much are the fees? never traded with IB

I believe you are thinking of a trailing stop. that should stay with the broker until triggered and then sent out as a market order. a regular stop order should get sent out to the market when placed.

yeah, I don't see why anyone wouldn't do this for real and expect the same results regularly.

supposed to be increased margin requirements on naked options on the leveraged etf's in the near future as well. requirements for the underlying's were already jacked up

most don't require the use of margin, but still have do have a margin account to put them on. unless you're only doing cash settled

what is charting the option going to do for you?

I believe some brokers will not allow clients to exercise ITM positions if they don't have funds in their account to cover the resulting buy/sell of stock. Check your broker's policy and the option agreement you signed when you opened the account.

depends, is the $500 being used to meet the margin requirement? If so then most likely not. If you had the margin requirement beforehand and the $500 is free cash then you should be earning interest on the proceeds, but probably not a hell of a lot these days

I'd guess they aren't checking dividend dates, and a lack of understanding that they're going to be on the hook for that dividend when assigned.