Same day SPY options after 1 pm.

D

dickey7

Any low cost broker that allow afternoon same day SPY option transactions to be opened? Robinhood does not allow same day options trades (only to close a position previously opened), and EOption cuts off opening activity after 1 pm on expiry day. Need this functionality for hedge on day trading strategy I am testing. Hoping one of the discount brokers provide this....
Thanks
 
Robert Morse said:
Yes. Will you close before 4pm?
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I will not be using daily day trading buying power 4x, only cash or overnight 2x.... SPY only. But intentions would be to close, let expire, or assignment... which can occur after 4, I do believe. So long way of saying, no... may not end up closing by 4.
 
You can't use leverage to buy options, so the 4X or 2X is not the issue. I do not remember if the expiring SPY options close at 4 pm ET or 4:15 pm ET. If you expect to hold expiring options after 4 pm and do not have the funds if they are still in your position at 4:15 pm, I'd have to ask risk if that is your intent, what to expect.

call me Monday or email me directly with details of your account and that question and I will ask Monday.
 
This question comes up pretty much every week in the options industry. I don't know the OP's intent, but this question is classic and that is part of the reason most brokers won't touch this business or ramp up the margin requirement. This is the proverbial picking up dimes in front of steamrollers. In the '80s in the OEX the scheme was to sell very short-dated premium - if there is any. Customers would mark "opening orders" as "closing" to game the system. The intent is pretty much the same - sell very short-dated premium and pray. Firms figured it out and generally restricted the accounts. Today's technology is much better and most firms simply won't do it without a ton of SMA. In 87 the strategy self-corrected and simply destroyed the short put side of the equation. There are a number of funds that love this strategy and try to accomplish it in some size in the SPX, but with enormous margin requirements.
 
ETJ said:
This question comes up pretty much every week in the options industry. I don't know the OP's intent, but this question is classic and that is part of the reason most brokers won't touch this business or ramp up the margin requirement. This is the proverbial picking up dimes in front of steamrollers. In the '80s in the OEX the scheme was to sell very short-dated premium - if there is any. Customers would mark "opening orders" as "closing" to game the system. The intent is pretty much the same - sell very short-dated premium and pray. Firms figured it out and generally restricted the accounts. Today's technology is much better and most firms simply won't do it without a ton of SMA. In 87 the strategy self-corrected and simply destroyed the short put side of the equation. There are a number of funds that love this strategy and try to accomplish it in some size in the SPX, but with enormous margin requirements.
More...
This wouldn’t be used for scalping the small amount of daily premium, I.e. - not risking getting in front of the steam roller. It’d be in the form of a hedge, likely a covered call, or protective put to get out of or further protect a day trade gone south... so in essence the options would be covered or backed by underlying SPY.
 
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