margin charge under PM for call vertical spread

N

njrookie1

can anyone please educate me on how IB charges margins for portfolio margin account for call vertical spread? in particular, long dated single name or narrowly defined etf options.

say I want to:

long IBM jan 2015 call at 200
sell IBM jan 2015 call at 150

IBM is currently trading at $175.

how much margin equity will IB charge me under portfolio margin? does it cost the same if i switch the direction of the spread?

thanks in advance for any help.

njrookie
 
Go on your sim account, put on the spread and then click 'Try PM' under the Account Window 'Margin Requirements' option. It's a little yellow box on the right. It will show your current Reg T margin and the 'what-if' portfolio margin.



FWIW, I'm trying to do it myself on sim but because the 150 call is DITM it won't even execute.
 
I can't speak for IB, but I can use THE OCC calculator to determine PM requirements for that spread (I entered 10X) based on yesterday's close. THis is what the OCC requires IB to post for this position.

$12,603

Any requirement after that is a house rule imposed by IB.

See PDF
 

Attachments

The vert req under PM will be lower than the debit req, but it will converge on moneyness (deeper ITM, higher req). Obviously it's prudent to treat each vert as THE debit requirement.
 
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