Full service broker will not do options

[MTE]

Quote from blackjack007:

this is not correct. he is selling naked because he did not short the stock and he's probably not approved for naked selling. if you want to gain approval for it in a margin account, you generally need 6-figure account equity.

alternatively, he can convert the account to cash (instead of margin) and convince the broker to let him sell naked cash-secured puts, which is what he's trying to do. they should let him, since it's no risk to them. if they don't, find a new broker because this one sucks

That's the reason I said he's not selling nakeds! That is, he actually has the cash to buy the stock so technically he's not selling naked.
Anyway, his broker is obviously too restrictive.

 

[MTE]

Quote from mike007:

Get thinkorswim. Alot cheaper on commissions and more complex order management and powerful software.

Ditto.

TOS doesn't have trading levels.

 

[ZEAK]

Quote from MTE:

It could be that their risk management department may require more than 100K or whatever the amount account to be able to sell options, despite the fact that you are not selling nakeds. That's a common problem with brokers that do not specialize in options and have trading levels with specific restrictions that they assign to their customers.

It could also be that they may not deal in options much and hence don't wanna bother with it.

Thanks for all the opinions. I think it is just that they dont want to bother with options as they do not do much of them. Too bad, as I could have hedged my account some before this sell off.

Got an IB account so I will use that to sell cash secured puts until I have all the shares I want. Much cheaper comish as well.

 

[blackjack007]

Quote from MTE:

That's the reason I said he's not selling nakeds! That is, he actually has the cash to buy the stock so technically he's not selling naked.
Anyway, his broker is obviously too restrictive.

i didn't make myself clear last time so i'll try again.

you don't seem to understand what "naked put selling" is, and neither does jjack for that matter.

if the op sells a put without shorting the stock, that is a naked short sell. whether he has the cash to back it up is not relevant to the definition of 'naked'.

one more time:

he was attempting to sell naked; it doesn't matter if he has a billion dollars in the account, it's still considered naked if he's not short the underlying, and this requires level 5 approval if he's in a margin account. you may think it's a silly rule (it is in some ways) but that's how it works.

'cash-secured' and 'naked' are two different things

i hope that's more clear.

 

[MTE]

Quote from blackjack007:

i didn't make myself clear last time so i'll try again.

you don't seem to understand what "naked put selling" is, and neither does jjack for that matter.

if the op sells a put without shorting the stock, that is a naked short sell. whether he has the cash to back it up is not relevant to the definition of 'naked'.

one more time:

he was attempting to sell naked; it doesn't matter if he has a billion dollars in the account, it's still considered naked if he's not short the underlying, and this requires level 5 approval if he's in a margin account. you may think it's a silly rule (it is in some ways) but that's how it works.

'cash-secured' and 'naked' are two different things

i hope that's more clear.

Oh, don't worry, I understand perfectly what you are saying.
Look, at the end of the day, it doesn't matter, the broker is obviously too lazy or not educated enough or doesn't have the right system set up. If someone wants to trade options then he/she should go to a broker that specializes in options. Then it is just a matter of choosing the one that suits you.

 

[snowhite]

He is right you are a not worth the risk for such a little account mainly.

 

[dagnyt]

Quote from snowhite:

He is right you are a not worth the risk for such a little account mainly.

There is ZERO risk for the BROKER when puts are cash secured

Mark

 

[JJacksET4]

"he was attempting to sell naked; it doesn't matter if he has a billion dollars in the account, it's still considered naked if he's not short the underlying, and this requires level 5 approval if he's in a margin account. you may think it's a silly rule (it is in some ways) but that's how it works. "

No, you don't necessarily need level 5 - I have a fairly small amount in my Margin OX account and I CAN SELL PUTS without having Level 5 approval. I only have level 4 and do not want and have never asked for level 5 (I don't want to sell uncovered calls! LOL) And my spending power only goes down by the margin put selling calculation. I know - I have naked puts in my Margin account right now with level 4. Oh and just to clarify, I am NOT short any shares for my put sales.

 

[MTE]

Quote from JJacksET4:

"he was attempting to sell naked; it doesn't matter if he has a billion dollars in the account, it's still considered naked if he's not short the underlying, and this requires level 5 approval if he's in a margin account. you may think it's a silly rule (it is in some ways) but that's how it works. "

No, you don't necessarily need level 5 - I have a fairly small amount in my Margin OX account and I CAN SELL PUTS without having Level 5 approval. I only have level 4 and do not want and have never asked for level 5 (I don't want to sell uncovered calls! LOL) And my spending power only goes down by the margin put selling calculation. I know - I have naked puts in my Margin account right now with level 4. Oh and just to clarify, I am NOT short any shares for my put sales.

ditto. I'm with Thinkorswim and they don't have trading levels at all! And I can sell naked puts without a gazzilion dollar account.

Anyway, these are just semantics.