What and how much do I need to own as collateral to cover a vertical call spread? I already bought the calls but it won’t let me sell because I don’t have collateral?
First bull call spread
- Thread starter Rickastleyjr2
- Start date
You shouldn't need more collateral then the difference between the two strikes of your spread, for example $500 for $5-wide spread.
But this may also depend on your broker and existing positions. Some brokers may simply have bugs in their margin calculations, or functionality (unable to determine that you'll end up with vertical spread).
Contact your broker and ask why you can't sell a call to create vertical spread.
But this may also depend on your broker and existing positions. Some brokers may simply have bugs in their margin calculations, or functionality (unable to determine that you'll end up with vertical spread).
Contact your broker and ask why you can't sell a call to create vertical spread.
If you have a brand new account, you may have a low trading level that does not allow spreads. You may need to request an upgrade to a higher level of trading.
Most brokers require you to have a margin account with at least $2,000 in cash or marketable securities in order to trade spreads. Do you have enough equity in your account?
BMK
Most brokers require you to have a margin account with at least $2,000 in cash or marketable securities in order to trade spreads. Do you have enough equity in your account?
BMK