Kevin the chat helper on ThinkorSwim tells me Exchange Traded Funds must be compliant with the DAY TRADER rule of the exchanges. So I would be limited to two trades per week on SPY scalping options.
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HowardCohodas Index Options Credit Spread Trading Journal
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OPTIONS are not part of the day trader rule??? You sure? Anyplace I can verify that?
Quote from ammo:
futures options are not,es is a future,spy options are on an etf and they are subject to the rule
Agreed. When I first started trading SPX option spreads I was close to being labeled as a PDT when I rolled a spread.
If you want proof go to www.thinkorswim.com and click on the live help drop down. From there click on trade desk. Once the chat starts up ask them. You dont even have to be a client. Talk about customer service!
From the horses mouth!
Thank you for the email. The rule is the same for Options and Stocks â for accounts under 25k you are limited to 3 day trades per 5 rolling business days per FINRA regulations. Remember that a day trade is opening and closing the same position in the same business days. You can open as many positions as your account can hold if they are held overnight. Here is a link for FINRA for further explanation.
http://www.finra.org/investors/smartinvesting/advancedinvesting/daytrading/p005906
Thank you for the email. The rule is the same for Options and Stocks â for accounts under 25k you are limited to 3 day trades per 5 rolling business days per FINRA regulations. Remember that a day trade is opening and closing the same position in the same business days. You can open as many positions as your account can hold if they are held overnight. Here is a link for FINRA for further explanation.
http://www.finra.org/investors/smartinvesting/advancedinvesting/daytrading/p005906
Quote from falconview:
From the horses mouth!
Thank you for the email. The rule is the same for Options and Stocks â for accounts under 25k you are limited to 3 day trades per 5 rolling business days per FINRA regulations. Remember that a day trade is opening and closing the same position in the same business days. You can open as many positions as your account can hold if they are held overnight. Here is a link for FINRA for further explanation.
http://www.finra.org/investors/smartinvesting/advancedinvesting/daytrading/p005906
You can overcome all that bullshit using ETFs and inverse ETFs. I.e. SPY and whatever is the inverse SPY.
example: You go long 100 spy today and to liquidate you go long the inverse today, etc.
In futures and futures options accounts the rule does not apply.
Eduamon
I understand a glimmer of what you are saying.
I´m in a SPY expwerimental trade this morning again. This is a quickie trade for a small amount using SPY options.
I´m learning what are the best number of contracts to fit my account size.
As I understand you, you are saying buy call options and to get out buy put options?? Or a sort of trading range type staggered effect. I´m not sure that would work, to carry you overnight and avoid the day trader in and out, one day rule.
I understand a glimmer of what you are saying.
I´m in a SPY expwerimental trade this morning again. This is a quickie trade for a small amount using SPY options.
I´m learning what are the best number of contracts to fit my account size.
As I understand you, you are saying buy call options and to get out buy put options?? Or a sort of trading range type staggered effect. I´m not sure that would work, to carry you overnight and avoid the day trader in and out, one day rule.
Quote from falconview:
Eduamon
I understand a glimmer of what you are saying.
I´m in a SPY expwerimental trade this morning again. This is a quickie trade for a small amount using SPY options.
I´m learning what are the best number of contracts to fit my account size.
As I understand you, you are saying buy call options and to get out buy put options?? Or a sort of trading range type staggered effect. I´m not sure that would work, to carry you overnight and avoid the day trader in and out, one day rule.
I was under the impression that you were scalping SPY, the stock. In SPY options I can't think of a workaround right now.
My fault. I´m an old man and I even forgot the word SCALP this morning. Could not for the life of me remember the word for the previous post.
Anyway on a scalp trade yesterday I made $450 net, with funny money, but it used up $14,000 thereabouts. Which is more account risk than I want. Seems on review this morning I made the same mistake again. Went 50 contracts using delayed data which screws up your calculations. I had it in my mind that I wanted to trade around $5000 per scalp trade in an actual cash account eventually. I ended up somehow getting a price of .60 cents an option premium and it should have been double that. Think I was in the wrong month or something? Anyway this morning when I reviewed I show too much money at risk, around $12,400. So guess I will go to 25 contracts another day, maybe tomorrow? I kind of learn the hard way by doing. It is a different world in trading now with all this information and computer graphics. Much better than when I did this stuff 40 years ago and lost my stake.
Anyway on a scalp trade yesterday I made $450 net, with funny money, but it used up $14,000 thereabouts. Which is more account risk than I want. Seems on review this morning I made the same mistake again. Went 50 contracts using delayed data which screws up your calculations. I had it in my mind that I wanted to trade around $5000 per scalp trade in an actual cash account eventually. I ended up somehow getting a price of .60 cents an option premium and it should have been double that. Think I was in the wrong month or something? Anyway this morning when I reviewed I show too much money at risk, around $12,400. So guess I will go to 25 contracts another day, maybe tomorrow? I kind of learn the hard way by doing. It is a different world in trading now with all this information and computer graphics. Much better than when I did this stuff 40 years ago and lost my stake.
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