Portfolio Margin at ThinkorSwim

[xflat2186]

Its not just comish they want to try their best to keep margins as high as they can too becasue they make money holding your money.

 

[daytrader1540]

Your right I did not think about that aspect

 

[rayl]

This has to be one of the funnier threads I've seen in a while. Just to add to conspiracy theories: TOS wants you to go take an Investools class, preferably not one of the free teaser ones.

 

[xflat2186]

I didnt read the whole thread... but you know all these brokers and prop shops where you bring your own dough make a nice buck on your money. Even if you're a JBO your clearing firm makes it. Part of doing business

 

[opt789]

Well it is finally here. TOS is now putting traders on portfolio margin. We will have to wait and see how things play out and whether they make changes to it. I wonder what the max number of naked index Puts I call sell is? Just kidding.

 

[weewilly]

Yes, Smiling Bob is living large!

 

[stoic]

I read the test. not much to do with CPM. not much of a test.

 

[Aardvark]

Would it make sense using PM to say buy 100 sh SPY and sell 1 or 2 calls on IWM? buying the lower vols selling the higher ones?

 

[stoic]

It's about time someone look at Customer Portfolio Margin in light of its true advantage, "the offsets across product groups".
Most of the talk so far has been about the reduced margin requirements. Accounts setting at 17 or 18 percent requirement. The fact is that the equity percent that you are comfortable with under Reg T should be the one you use under CPM. The real advantage to CPM is the ability to use securities/options in one security class to hedge a position in another security class. Under Reg T a long position in SPY and short Calls in IWM would have the requirement on the long SPY side and the requirement on the naked calls. Under CPM the requirement on the SPY (Group 9) are offset @ 50% from the calls on IWM (Group 45).

Not knowing your strategy or the strike prices you are looking at I can't say. But the opportunity to put on complex security/options strategies within product groups and across security class to take advantage of higher premiums or temporary discrepancies in price movement of various indices is what CPM is all about.

 

[daytrader1540]

I am starting PM today and I think it is a useful tool although I am going to be conservative with it