any idea about future option margin

[Maverick74]

Quote from RichardRimes:

Future options do have additional margin requirements even if you purchase the option, this is because if you purchase a put you are considered to be long that instrument. If its an ES put and it goes in the money on the weekly, for instance, you will find yourself the proud owner on a long ES contract on Sun eve...and you will have maintainence margin on it. I think this is what the op is referring to.

Edit. You will be short on sun nite...i

No, there is some confusion here. These are two different things. The margin for options and the margin for futures. If you are long a put, you pay for the premium in full. If you "choose" to exercise that put and he short the future upon expiration then you now have the margin of holding a future position. It's no longer an option position. It's important to keep the two separate, they are not the same thing.

What made matters worse is he kept talking about the put not requiring any margin. As for expiration day, I'm not sure what he is referring to. You, the trader has to take ownership of any risk you have on expiration day. Almost every broker I know of sends out notices making sure you are aware that you have in the money options that could be exercised against you or given to you.

 

[trader198]

I do not support delivery/optionexercise too. as I told you, we are human being. sometimes we may have some mistakes and let that happen.

totally understable.

Quote from toonerdy:

Thank you, trader198, for teaching me about a house rule at Interactive Brokers that I was not aware of, which is discussed at at http://ibkb.interactivebrokers.com/node/1767 , paragraph 4 (just below the first chart):

"To protect against these scenarios as expiration nears, IB will simulate the effect of expiration assuming plausible underlying price scenarios and evaluating the exposure of each account assuming stock delivery. If the exposure is deemed excessive, IB reserves the right to either: 1) liquidate options prior to expiration; 2) allow the options to lapse; and/or 3) allow delivery and liquidate the underlying immediately thereafter. In addition, the account may be restricted from opening new positions to prevent an increase in exposure." [my emphasis]

This page is referred to from the page on margin for US options at https://www.interactivebrokers.com/en/index.php?f=marginnew&p=opt where it says "Please note that we do not support option exercises, assignments or deliveries which may result in an account being non-compliant with margin requirements. For additional information about the handling of options on expiration Friday, click here (Knowledgebase Article http://ibkb.interactivebrokers.com/node/1767 )." [my emphasis]

Thanks again for posting about this. It could be relevant to a lot of people's strategies.