Scottrade?

spreadgod · Sep 6, 2005

Quote from da-net:

I quit trading with Scottrade many years ago too. Perhaps someone can confirm something I was told about Scottrade. An acquaintance said they placed an online order as a GTC and then their web connection was down for a few days. While their web connection was down, they called into Scottrade to have the order cancelled only to be told there would be a $20.00 charge to do that. Is this true? Has Scottrade become so arrogant to chare like this to cancel an order?

That's the first I've heard of a retail online firm charging to cancel an order. I did find out that Interactive Brokers charges a cancellation fee, but they're a direct-access broker. Here's their take on why they charge the fee:

Quote from def:

there are a few facts you may not know about in regards to the IB cancel fee.

1. credits are given against executions.
2. exchanges charge $1 per cancel/modify
3. IB's minimum commission is $1

Firms with higher minimums per trade, can easily absorb the cancel fee. With IB's fee, if we didn't pass on this cost, we wouldn't be profitable. In short, the cancel fee along with the execution credit works well for most of our clients.

murray t turtle · Sep 6, 2005

Quote from Death Note:

Is Scottrade good for options trading?

===========================
Could tell you some war stories, especially on option quotes @ most any broker

;
one of the best defenses against a foggy/false quote is know underlying & option one trades/invests.

Amoung the better brokers for options;
Interactive Brokers
OptionsXpress.

spreadgod · Sep 9, 2005

Quote from smilingsynic:

The funny thing, is that Scottrade allows covered calls, but selling cash-secured puts--no way. Is that silly or what?

Needless to say, I stopped trading with them years ago.

That's ridiculous. How can you not let someone write a covered put...conservative firm or not? While I won't mention the firm I work for (compliance issues) we don't differentiate between calls and puts for being approved for covered option writing. You're either approved or not approved.

Besides, covered put option writers usually want to own the stock anyways, just for less money. They obviously think it's going up or not moving below the price they're writing the put at. If the stock drops, the stock's put to you for less than what you would've paid when you wrote the option AND you got premium on top of it. How is that riskier than outright buying of stock?

smilingsynic · Sep 10, 2005

Quote from spreadgod:

That's ridiculous. How can you not let someone write a covered put...conservative firm or not? While I won't mention the firm I work for (compliance issues) we don't differentiate between calls and puts for being approved for covered option writing. You're either approved or not approved.

Besides, covered put option writers usually want to own the stock anyways, just for less money. They obviously think it's going up or not moving below the price they're writing the put at. If the stock drops, the stock's put to you for less than what you would've paid when you wrote the option AND you got premium on top of it. How is that riskier than outright buying of stock?

Of course it's ridiculous, but I guess they're afraid of having clients "naked" options. Needless to say, I do not recommend Scottrade if you trade options. :-)

da-net · Sep 10, 2005

Quote from spreadgod:

While I won't mention the firm I work for (compliance issues) we don't differentiate between calls and puts for being approved for covered option writing. You're either approved or not approved.

I am extremely confused....How could mentioning what firm you work for be a compliance issue? You are not soliciting customers. You are not advertising. You are not making trading recommendations. You are not holding a class in investing, and even if you were you could add the normal caveat that all BDs do.
You are simply stating a fact. If your firm truly believes that it is a compliance issue...they need a new compliance officer.

cowpok1027 · Sep 10, 2005

Hi da-net & all you option traders
I came accrossd this post:
==========
Quote from spreadgod:

While I won't mention the firm I work for (compliance issues) we don't differentiate between calls and puts for being approved for covered option writing. You're either approved or not approved.
--------------------------------------------------------------------------------
I am extremely confused....How could mentioning what firm you work for be a compliance issue? You are not soliciting customers. You are not advertising. You are not making trading recommendations. You are not holding a class in investing, and even if you were you could add the normal caveat that all BDs do.
You are simply stating a fact. If your firm truly believes that it is a compliance issue...they need a new compliance officer.
==========
#1
It seems to me pretty obvious that spreadgod works for IB else why would he quote IB rules on option cancellation.
#2
ALL brokerages have some downsides regarding THEIR rules (RULES TO THEM ARE DESIGNED TO KEEP THE SEC OFF THEIR BACKS & PROTECT THEIR ASS - PERIOD!)
#3
I'm not endorsing any broker but I do use IB for their low commissions & option trading flexibility; however, they (IB) don't know shit about compliance - I've had some bad experiences & evidence to prove they will screw you & don't seem to care much about retail customers !! -- Who is your compliance officer @ IB spreadgod?

da-net · Sep 10, 2005

Hi Cowpok,

You are correct about how BDs attempt to "Cover Their A**". In fact I now have several problems with one. Most of the problems could have been resolved very easily, but now the problems have gotten so bad that the compliance officer stated "get the rules and show me"! I have taken his demands literally...I have hired an attorney, researching everything during downtime and am reading a marvelous book that is really opening my eyes. The book is "Does Your Broker Owe You Money? by Daniel R. Solin". When I am finished reading the book I plan on posting a review for others to see. Every trader needs to read books like this.

cowpok1027 · Sep 10, 2005

Dear da-net

Good luck with your "problem broker."

I've been in the stock & options markets for almost 40 years so I have many 'stories."

I'm really looking forward to your post after you read "Does Your Broker Owe You Money? by Daniel R. Solin".

Good luck & Good trading !! cowpok1027

spreadgod · Sep 11, 2005

Quote from da-net:

I am extremely confused....How could mentioning what firm you work for be a compliance issue? You are not soliciting customers. You are not advertising. You are not making trading recommendations. You are not holding a class in investing, and even if you were you could add the normal caveat that all BDs do.
You are simply stating a fact. If your firm truly believes that it is a compliance issue...they need a new compliance officer.

I agree that it would seem harmless to mention who I work for, but unfortunately Mr. Spitzer up there in NY has every firm running around scared and trying to keep a tab on everything their employees do. Our firm just simply does not allow any kind of posting on message boards. I'm guessing they don't want anything said on here to be attributed to them without first seeing what's posted. And frankly, they don't need to waste the time/manpower/expense on something as trivial as that. cowpok1027 puts it pretty much in perspective with #2:

Quote from cowpok1027:

#1
It seems to me pretty obvious that spreadgod works for IB else why would he quote IB rules on option cancellation.
#2
ALL brokerages have some downsides regarding THEIR rules (RULES TO THEM ARE DESIGNED TO KEEP THE SEC OFF THEIR BACKS & PROTECT THEIR ASS - PERIOD!)
#3
I'm not endorsing any broker but I do use IB for their low commissions & option trading flexibility; however, they (IB) don't know shit about compliance - I've had some bad experiences & evidence to prove they will screw you & don't seem to care much about retail customers !! -- Who is your compliance officer @ IB spreadgod?

But no, I obviously don't work for IB since A) they have posters on here all the time who identify themselves as from IB and B)if you look through my previous posts, I only found out about IB through this message board. IBSoft actually responded to one of my first posts questioning an option order execution. And I quoted the cancellation fee from a post I had QUESTIONING order cancellation fees. (I had never heard of them before).

Regardless, I actually get a lot of info from this message board and I just try to comment on things where I feel I have some knowledge or experience.