Clearing a covered call

Thanks for the suggestions everyone.

$1 contracts are what initially attracted me to MB, I'm cheap at heart and can't stand paying 3, 5, or 10 times as much somewhere else. I don't really use any broker-provided services other than execution...do my own research with various outside sources...so in my mind commissions are 98% of what's important to me.

This makes me lean toward IB, but I'm afraid I won't be able to qualify yet since I'm just starting out with options and they require 100 trades of prior experience to open an account. Maybe I'll just buy straddles at MB until I get those 100 trades under my belt and then move on...I can't think of any way for MB to cheat me on long option positions.
 
Quote from CloroxCowboy:

Thanks for the suggestions everyone.

$1 contracts are what initially attracted me to MB, I'm cheap at heart and can't stand paying 3, 5, or 10 times as much somewhere else. I don't really use any broker-provided services other than execution...do my own research with various outside sources...so in my mind commissions are 98% of what's important to me.

This makes me lean toward IB, but I'm afraid I won't be able to qualify yet since I'm just starting out with options and they require 100 trades of prior experience to open an account. Maybe I'll just buy straddles at MB until I get those 100 trades under my belt and then move on...I can't think of any way for MB to cheat me on long option positions.
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Even if you only require execution, commissions are only one of the factors that you should consider when choosing a broker. I'd say quality of exection and platform stability/reliability are arguably more important than low commissions.
 
Agreed, those two factors are important, but for the CC strategy I have in mind, commissions will make or break the profit margin. It's very low profit, but nearly zero risk. And it would probably be the only type of trade I do in that specific options account. I can't say I'm thrilled with MB's platform, but until I get an account with lower commissions (seems like IB is the only better deal), unfortunately that strategy is a no-go.
 
Quote from CloroxCowboy:

Maybe I'll just buy straddles at MB until I get those 100 trades under my belt and then move on...I can't think of any way for MB to cheat me on long option positions.
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That's one way to gain some experience.

Buy I'd give 50 to 1 odds that you lose a substantial potion of your money if you do adopt that strategy.

Buying straddles is for very sophisticated traders only. And I think it's a money loser for the majority of those.

Mark
 
Thanks. I have a solid understanding of straddles. The "experience" is not really for me to learn about options, just to satisfy IB's 100 trade rule. Straddles are one method I might consider to get those 100 trades, and I would probably take those odds you mention...I agree they can be tricky if you don't understand the greeks, especially vega impact in today's market...and if you don't have a decent way to scan for the best prices, but with the right knowledge and tools they are no riskier than many other strategies. I may incorporate straight long options into the pairs trading I already do as well.
 
Quote from CloroxCowboy:

Thanks. I have a solid understanding of straddles.
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I accept that.

I assumed someone with fewer than 100 trades was a rookie.

Mark
 
Yes, I totally understand, it's what I would have assumed as well. I probably should have given more background about myself since I'm new to posting on this board. Technically I guess I am still an options rookie, going by the number of actual trades under my belt, but I don't really consider myself one. I have enough knowledge of options theory and enough experience trading other things that I'm not worried about making rookie mistakes. Sorry for any misunderstanding, I realize your intentions were helpful. :D
 
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