SPX Credit Spread Trader

[El OchoCinco]

You have more of an accounting nightmare than me becausae you are a larger group than me (2 people). IRAs I assume make it easier since you do not have to worry about the taxes lol.

For VT your group will get a K-1 and then you will have to divide the P/L among the members based on their entitled %. So it is easy as well I think.

Quote from Sailing:

Possible accounting nightmare?

IB has book management within the advisors accounts. V-trader would be one single entity and a ton of book keeping.... but I guess outside third party software is available....

Have you gone through this decision process when dealing with your 'other' account managements?

M~

 

[scoobie27]

Quote from optioncoach:

Scoobie:

A lot of great questions so I hope I do not miss any or hopefully Sailing Murray hit most of them.

Nope, you pretty much got everything



As for the puts, I prefer credit spreads and put ratio spreads but I need to see how the diagonals work for debits on the put side so I did a 20 lot position. I want to see VIX increases in action

I am very curious with these diagonals too now, to reduce anxiety levels with my CS positions. I've been doing credit spreads roughly once a month in lots of 5 with good success so no anxiety yet...touch wood.

What I like is that the market moving to the short strike is not as daunting as it is with bull put spreads and ratio spreads so it gives me another tool.

Should not be daunting but make you happy if it moves to your short Put, cause your position will be positive But i've got to test this too.

I heard one trader say that if all you have in your toolbox is hammers, everything looks like a nail to you. I want more tools....

Too many tools make me confused. Just give me a hammer anyday

Thanks coach.

 

[momoneythansens]

Quote from Sailing:

Since you're trading both SPAN and Haircut risk based margin, if you had to choose between the two, which one and why?

Murray, sorry haven't kept up with thread last couple of days. Apologies if this has been discussed:

Benefits of MM haircut vs. SPAN for (naked) long options is something to look at.

 

[El OchoCinco]

Phil,

Since you're trading both SPAN and Haircut risk based margin, if you had to choose between the two, which one and why?

Murray

Murray:

For the ES I really do not check to see my SPAN v. Haircut margin. I just see the haircut and happily do not have to choose between the two becaue I get both lol. I think in many cases SPAN and the haircut might be close to each other unless the positions are lreally large and small differences add up.

But my daily sheets just list my haircut so I just go off that

 

[scoobie27]

Very light volume on ES compared to SPX. Not really enjoying this legging in business. Legged in one side (but I think thats only because the market moved in favour of the other party).

Now trying to leg in the other side and worried the market may run away making me pay more than I have to.

Just an observation

 

[mdshiao]

I would like to open an IRA account at IB to trade ES spreads as coach did (long or short ES). But I heard that IRA account does not allow margin. Can someone verify that IB allows IRA account to trade ES spread?

Thanks,
mdshiao

 

[momoneythansens]

Quote from scoobie27:

Very light volume on ES compared to SPX. Not really enjoying this legging in business. Legged in one side (but I think thats only because the market moved in favour of the other party).

Now trying to leg in the other side and worried the market may run away making me pay more than I have to.

Just an observation

What no free lunch?! Sue them!

Hedge with ES if legging size and significant interval between completion.

 

[momoneythansens]

Quote from mdshiao:

Can someone verify that IB allows IRA account to trade ES spread?

Thanks,
mdshiao

From the horse's mouth: http://www.elitetrader.com/vb/showthread.php?s=&postid=1087112#post1087112

 

[scoobie27]

Quote from momoneythansens:

What no free lunch?! Sue them!

LMAO That's why im trading options. To pay for lunch and more

Hedge with ES if legging size and significant interval between completion.

So that's only with significant size right? ie hedge the delta equivalent with ES? What if im trading 5 lots

 

[El OchoCinco]

Pick one side to get very aggressive with and shave off the bid or ask. As soon as you get filled grab the other side to lock in the spread, maybe only shaving one tick off that bid or ask so you can get filled quickly. I usually leg in rather fast since I am not trying to buy at the original bid and get too greedy. If the market starts moving after leg 1 is filled, I just grab the second leg at the bid or ask to make sure I get it. That is why I try and get really aggressive with the 1st leg so if I have to grab the seoncd in a rush I still will l ike the credit I get.

Quote from scoobie27:

So that's only with significant size right? ie hedge the delta equivalent with ES? What if im trading 5 lots