SPX Credit Spread Trader

[El OchoCinco]

Not all please, no problem on the questions.

The key is you said "no one will give you capital to do options-only strategies". Most people who go prop are trading their own money. I am trading my own money so I can trade any thing that is clearable through them. You sound like you are looking for a prop scenario where you put no money down and are trained on options with the house money. That is rare. But you can trade your own money and do whatever you want within risk parameters. You also do not need a Florida prop unless you are specifically looking for in house locale and training. So if you want to ride on someone else's money I doubt you will find many who let you do options (most who do are in equity prop).

However many option props let you start with $5k or $10k as long as you trade within your limits.

It is late and too lazy to google or check CME, so forgive me.. what is ZN? Treasuries?

Quote from nravo:

Coach, two non credit-spread questions and I again apologize for the digression: 1) You mentioned you prop trade. When I looked around South Florida for prop traders who took on options-only traders, I was informed by almnost everyone that no one will give you capital to do options-only strategies. How did you manage to find a shop? 2) You do ZN ever as well as ES? Why or why not?

 

[nravo]

Quote from optioncoach:

Not all please, no problem on the questions.

The key is you said "no one will give you capital to do options-only strategies". Most people who go prop are trading their own money. I am trading my own money so I can trade any thing that is clearable through them. You sound like you are looking for a prop scenario where you put no money down and are trained on options with the house money. That is rare. But you can trade your own money and do whatever you want within risk parameters. You also do not need a Florida prop unless you are specifically looking for in house locale and training. So if you want to ride on someone else's money I doubt you will find many who let you do options (most who do are in equity prop).

However many option props let you start with $5k or $10k as long as you trade within your limits.

It is late and too lazy to google or check CME, so forgive me.. what is ZN? Treasuries?

Yes, ZN are the options on the 10-year.

Trading OPM would be nice but even part OPM would be even better. I'm not sure what a prop shop would offer me that IB doesn't if I do naked and condors on SP futures mainly, maybe short some options on single stocks every now an then.

 

[El OchoCinco]

I am actually working on scalping the 10-year Note futures intraday like I do with ES, YM and ER2 so I would rather do that than the options for now.

We all would love to trade OPM but blunt reality is that Os will not give you their M as a newbie or small trader. You have to start with your own money.

A prop is made for intraday trading mainly in my opinion, not trading longer-term option positions. The beauty for me with the prop is that I can leg into positions if I want with the shorts first or open large positions and cross hedge with other products and not deal with reg T.

If you can trade your strategy effectively through IB and the margin requirements, then I agree you might not need a prop. But for me I know I could not do put ratio spreads in a retail account on the size I wish to do.

It is a personal choice realy and not a required element to be successful in trading. It is just a means to an end.

Quote from nravo:

Yes, ZN are the options on the 10-year.

Trading OPM would be nice but even part OPM would be even better. I'm not sure what a prop shop would offer me that IB doesn't if I do naked and condors on SP futures mainly, maybe short some options on single stocks every now an then.

 

[nravo]

Quote from optioncoach:

I am actually working on scalping the 10-year Note futures intraday like I do with ES, YM and ER2 so I would rather do that than the options for now.

We all would love to trade OPM but blunt reality is that Os will not give you their M as a newbie or small trader. You have to start with your own money.

A prop is made for intraday trading mainly in my opinion, not trading longer-term option positions. The beauty for me with the prop is that I can leg into positions if I want with the shorts first or open large positions and cross hedge with other products and not deal with reg T.

If you can trade your strategy effectively through IB and the margin requirements, then I agree you might not need a prop. But for me I know I could not do put ratio spreads in a retail account on the size I wish to do.

It is a personal choice realy and not a required element to be successful in trading. It is just a means to an end.

Thanks for the info. I'm not sure Risk Margin would offere me much more than Reg T if I am just writing naked options, if you or anyone can think of a reason, let me know.

 

[El OchoCinco]

Well risk margin could be less than Reg T for naked options but the better question is whether you really need it. If you are short SPX puts and sell Es futures, a retail account will not cross margin and will treat it as two separate margin requirements. Risk-based will not. So it is more of an advantage for hedging purposes in many cases.

Good luck! For now it seems IB works for ya so no need to jump ship.

PM me if you have more questions.

Quote from nravo:

Thanks for the info. I'm not sure Risk Margin would offere me much more than Reg T if I am just writing naked options, if you or anyone can think of a reason, let me know.

 

[Aardvark]

Quote from rallymode:

I'd be careful with any bullish positions here. Lotsa resistance ahead of us. We are also butting against the upper end of the breakdown channel. I think a retest of 1220 is coming shortly and perhaps 1200. We should know pretty soon, one way or the other.

hey Rally...not to nitpick but last week 6/15 on Cache's journal you mentioned that you were looking for a move to 1290/1300 to put on some bearish positions....any specific reason for change of heart? thx A

 

[rallymode]

Quote from Aardvark:

hey Rally...not to nitpick but last week 6/15 on Cache's journal you mentioned that you were looking for a move to 1290/1300 to put on some bearish positions....any specific reason for change of heart? thx A

James Cramer flip flops all the time, certain president candidates flip flopped all the time, hell even some presidents(W notwithstanding as i really hate to be equated with him LOL), so whats wrong with me doing it? I am just a regular guy

Seriously, i dont remember but i doubt i said the SPX was going to 1290-1300, i usually lean in a certain direction but i wouldnt bet the farm on it. I probably meant that it would be where i would open my bearish positions as i also reiterated in here a few posts ago. At this point i am leaning to the downside though, just dont feel we got enough good news in the closet waiting to come out and take us to the recent highs nevermind the fact that summer is rolling in. Waiting for my setups, will post a trade when i open one. I dont see much happening between now and Fed meeting. I think the market will churn here for a bit and make a move later next week.

 

[apex82]

Phil I have noticed you are doing a lot of intraday scalping on the futs now. Are you trading intraday swings or just a few ticks here and there? What type of setups do you like?

We are going to 1175-1185 in the S&P cash index with a small bounce at the 1205 area, good luck to anyone who buys earlier. The selloff will commence tomorrow or monday, mark my words.

 

[Aardvark]

Fair enough

 

[El OchoCinco]

Looks like the blue prints for a time machine .....

yes I am daytrading futures regularly now. I pretty much scalp intraday swings. I use candlesticks, moving averages, bollingers, stochastics, pivot points and opening gaps and trade breakouts and pullbacks to resistance or support. Sounds like a lot of indicators but they are not all used at the same time.

My main products are ES, YM, ER2 and EuroFX futures. Looking to add the 10-year futures as well. Like having different markets to look at the same time and wait for the right entries whenever they pop up. complimens my month to month credit spreads.

Quote from apex82:

Phil I have noticed you are doing a lot of intraday scalping on the futs now. Are you trading intraday swings or just a few ticks here and there? What type of setups do you like?

We are going to 1175-1185 in the S&P cash index with a small bounce at the 1205 area, good luck to anyone who buys earlier. The selloff will commence tomorrow or monday, mark my words.