Option Adjustment & Buying Power

A

AlphaLine

I have a question about adjusting a multi leg option contract. If the positions were balanced on both sides and if I attempt to adjust one of the positions (adding or subtracting position size), it does change the buying power.

Anyway around this without adding another multi leg or purchasing a single call or put?

Thanks for any insights.
 
AlphaLine said:
I have a question about adjusting a multi leg option contract. If the positions were balanced on both sides and if I attempt to adjust one of the positions (adding or subtracting position size), it does change the buying power.

Anyway around this without adding another multi leg or purchasing a single call or put?

Thanks for any insights.
More...

nope...most ppl leg out by buying back the short then selling the long...or close the short spread first then the long spread...or closing out the entire trade as one order.
 
Thanks for the reply. Yes, similar to an IC. The issue is when one side of the play is being threatened, I was removing positions and saw the buying power effect being raised.

This was only occurring if I was closing some of the long positions (profitable side). If I buy to close a portion of the short position (threatened position) then buying power remains the same. I suppose this makes sense as the margin required to hold short positions is greater than buying positions.

Thanks again.
 
RichardRimes said:
nope...most ppl leg out by buying back the short then selling the long...or close the short spread first then the long spread...or closing out the entire trade as one order.
More...

I will see what happens if I close an equal portion of the threatened sell and the profitable buy.
 
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