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Then I don't have enough information to give you an intelligent suggestion.

How much do you expect your portfolio to rise over the next 12 months. How much of that are you willing to spend in insurance? Also, I don't agree with your analogy. You don't have to be long the market, but you do need to live in a home and protect your investment.

All hedges have a cost. If I expected the market to drop more than10%, I would just sell out my portfolio.

My best guess is this is a business decision based on the time, effort and cost to the broker that is incurred by their regulator, FINRA. With us, a small introducing broker, during our exams from FINRA they is a lot more time and focus on foreign accounts then domestic.

It is my expectation that equity market makers hedge with that equity, but Cash settled index options are hedged with the related future. Eg SPX is hedged with ES.

Ever since market making has been automated, I set up my trades to auto hedge with the underlying. The hard part right now is not that you you take the other side when vol moves. Those trades tend to be good. The problem now is that someone will always be faster than you and their system will...

Until you are trading real money, you have no position on the CME order book, so you are being filled on some rule set up on the paper trading. It will not be the same.

Jarjar, You never said if these are equity options or options on futures. Bob

Not to my knowledge. I don't think the exchange allows you to query this.

Cancel replace puts you to the back of the order book. You would be better to send a second order to add quantity, unless you are paying ticket charges. Not worth paying for two tickets. I did not follow you second question the way you phrased it. If you are asking if it's possible to not get...

Maybe Bernie Sanders will help them out :sneaky:.

I agree. It is a hedged position already. Unless you hit some max loss that you are willing to take on anyone position, I would rarely adjust it. At some point, it might make sense to cover and roll to a later month, if you have risk or margin limitations. That was you are covering low priced...

No, that is what the Najarian Brothers do. When I traded as a market maker, my job was to provide depth and liquidity. I sold when those order bought. I would buy when they sell. I took the other side and hedged with the hope that I was being paid for my risk. It is possible because of my...

https://www.irs.gov/Businesses/Corporations/Foreign-Account-Tax-Compliance-Act-FATCA The provisions commonly known as the Foreign Account Tax Compliance Act (FATCA) became law in March 2010. FATCA targets tax non-compliance by U.S. taxpayers with foreign accounts FATCA focuses on reporting...

I basically had no choice. It was the game I paid to play in. You would not pay all that money to be a MM if you did not take advantage of the order flow.

When volume spikes from buying, IVOL always increases. When you are a MM, you are always doing the other side at price intervals, hedging with stock and adjust up all your values waiting to catch more buyers at higher prices or sellers to bring the prices back down. You just want to avoid...

The Najarian Brothers claim that this is their strategy. They follow the money. When I was an Option MM, I made a living fading these vol spikes and then hedging with other options when demand subsides. My time frame was hours and theirs was days. I think you can make money doing both as long as...

What do you mean by IC?

Not always true. If there are no customer orders and the options in ATM or OTM, it should be close. Customer bids/offers will change the mid point from the MMs. If you want to assume that the MM midpoint is fair value, that can be a good or bad assumption to make. Ether way, it is a good...

If you're setting up a single-member LLC, you might not need account right now. Many of my clients have used https://www.blumberg.com to form their LLC. You can go to the IRS website to get your EIN#.