SPX Credit Spread Trader

done all the time in futures accounts.

Quote from rdemyan:

Is anybody out there trading credit spreads from a retirement account?

I can't seem to get a clear answer on whether the IRS allows this or not.
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So this is where you've been posting spud. Dummy too. Come back to the boards, it's boring just having me combo lisbon and jwong there.
 
I believe for the most part, the main thing that the IRS doesn't allow in retirement accounts is naked selling, but don't listen to me, I don't trade a retirement account.
 
Quote from Cache Landing:

I believe for the most part, the main thing that the IRS doesn't allow in retirement accounts is naked selling, but don't listen to me, I don't trade a retirement account.
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That makes alot of sense. OX sems to allow the upper limit. But the major retirement company I just left only allowed covered calls. No buying of calls or puts at all, much less spreads.

I would assume that the people making those rules realize that a covered call is the same as a naked put (so why wouldn't they allow spreads?) but it is a major corp so who knows what they are thinking about when it omes to risk management..

Then again that is one of the few reasons I left.

OK Now I'm lurking and venting.
 
Quote from jnbadger:

That makes alot of sense. OX sems to allow the upper limit. But the major retirement company I just left only allowed covered calls. No buying of calls or puts at all, much less spreads.

I would assume that the people making those rules realize that a covered call is the same as a naked put (so why wouldn't they allow spreads?) but it is a major corp so who knows what they are thinking about when it omes to risk management..

Then again that is one of the few reasons I left.

OK Now I'm lurking and venting.
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Covered calls are essentially the safest/most uncomplicated form of options trading that a firm can allow in order to keep up with the competition but not jump into options trading completely. Only allowing covered calls ensures that you will always own the underlying to the extent that if you get assigned you will never be able to lose more than you own. It automatically limits the amount that you can leverage your account. They don't care if you lose everything you have, they just don't want you to lose more than that.

I imagine that in the case of naked puts, even though the risk profile of the options is essentially the same, the risk is not the same once you've been assigned. Consider the idea that you could sell a hole grip of naked puts. Then what happens if you get assigned and the underlying gaps down the next morning before you've had a chance to liquidate the shares you now hold. Early excercise is the clincher I think.:)
 
Well, I'm starting to think I'm going to have to change my opinion on the market. It seems to be following a nice long term bullish channel and looking back 6 or 7 years, there isn't really any defined resistance ahead. That really blows as I will now have to adjust my APR calls.:mad:

In regards to the Ansbacher Index; the convenient thing about a price based contrarian indicator is that if you follow it, you will always be buying cheap and selling expensive.:D I don't know that I trust it implicitly, but that little coincidence is nice.
 
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