Tastytrade has set my account to closing only

[tradegoodstocks]

This thread is possibly the dumbest of the year and this is the year of Quanto and wxytrader.

here’s the explanation of the note: OP is placing trades that no one would take the other side of. Placing trades costs money in terms of cancelation fees, routing costs, etc. while most of these fees are small they are real and tasty trade is bearing them for an order no one would execute against.

second the only trade that is trading are the ones where the OP is essentially locking in a loss because the spread will
Almost certainly be worth the full value and the OP is selling it for less than that. Tasty trade isn’t going to allow him to piss away all his money this way only to have him come back and sue them for allowing him to do this.

OP thinks that he can sell spreads at riskless prices but the world has an obligation to trade at a stale mid price.

OP should take tasty trade for arbitration for failing their duty as a broker. They should have never given him options trading access to begin with.

Your first sentence was superfluous, and I should probably not respond but ignore your comment because of the tone alone. But respectfully, while I cannot disprove you, I disagree with the rest of your comment.

High frequency algos and options dealers place and retract gazillions of unfilled limit orders per second. OP doesn't sound like he even uses automated trading. Respectfully, please quantify the broker's cost per placing a trade, or I don't believe in this theory as I believe the cost per order is perhaps an amount orders of magnitudes below one cent. Same for routing cost. We live in an age of high resolution wireless video streaming to just about every corner of the world. The cost of a few bytes of an order entry traveling the wires won't be measurable.

Regarding your remaining paragraphs. I know that box spread and similar vertical spread arbitrage trading has been a well known and popular strategy. Regardless whether this strategy works for certain markets or not - for the reasons that I mentioned before, I think the broker should have no reason to police and micromanage the individual orders of a customer. It is also kind of self contradictory - is it the order that would have been profitable for the OP, or is it the potentially loss making order, that was objectionable? Which one is it? Or should the broker perhaps leave the trading strategy choice to the customer? Nobody is forced to fill his order, and his orders had near zero margin risk, or the system should and would have instantly cancelled them. If not with the intent to arbitrage, box spreads or DITM vertical debit or credit spreads are commonly used to either invest spare cash or to borrow cash at implicit interest rates near the risk-free rate. Furthermore, walking up or down complex limit orders is a popular technique in options trading, which I use all the time, and which some brokers (e.g. Schwab) even offer as an automation tool of their trading platforms. In this context, the OP's orders and strategy don't even seem principally unusual or objectionable, regardless whether some of his specific limit orders got filled or not; and his question seems legitimate. Putting all these facts together, your comment makes little sense to me. The action of TastyTrade is hard to understand.

 

[newwurldmn]

Your first sentence was superfluous, and I should probably not respond but ignore your comment because of the tone alone. But respectfully, while I cannot disprove you, I disagree with the rest of your comment.

High frequency algos and options dealers place and retract gazillions of unfilled limit orders per second. OP doesn't sound like he even uses automated trading. Respectfully, please quantify the broker's cost per placing a trade, or I don't believe in this theory as I believe the cost per order is perhaps an amount orders of magnitudes below one cent. Same for routing cost. We live in an age of high resolution wireless video streaming to just about every corner of the world. The cost of a few bytes of an order entry traveling the wires won't be measurable.

Regarding your remaining paragraphs. I know that box spread and similar vertical spread arbitrage trading has been a well known and popular strategy. Regardless whether this strategy works for certain markets or not - for the reasons that I mentioned before, I think the broker should have no reason to police and micromanage the individual orders of a customer. It is also kind of self contradictory - is it the order that would have been profitable for the OP, or is it the potentially loss making order, that was objectionable? Which one is it? Or should the broker perhaps leave the trading strategy choice to the customer? Nobody is forced to fill his order, and his orders had near zero margin risk, or the system should and would have instantly cancelled them. If not with the intent to arbitrage, box spreads or DITM vertical debit or credit spreads are commonly used to either invest spare cash or to borrow cash at implicit interest rates near the risk-free rate. Furthermore, walking up or down complex limit orders is a popular technique in options trading, which I use all the time, and which some brokers (e.g. Schwab) even offer as an automation tool of their trading platforms. In this context, the OP's orders and strategy don't even seem principally unusual or objectionable, regardless whether some of his specific limit orders got filled or not; and his question seems legitimate. Putting all these facts together, your comment makes little sense to me. The action of TastyTrade is hard to understand.

No one has the full story. But everytime these threads are started the OP omits a very important detail.

 

[Primal Trader]

I have used Tastytrade for over two years, and I started trading in the mid-90's. Have been through a few brokers during that time. For myself, I am glad I found them and they have worked very well for me. They have Risk Managers on staff with immense real-world experience, who also program the platform to disallow certain actions. Risk managers who work hard to protect both their firm, which was bought by IG by the way, and their traders. Overall I think they do an excellent job. Perhaps the feedback you are receiving about your trades might be a helpful warning sign to you, by a collective who know options way better than many of us on here combined.

 

[poopy]

I have used Tastytrade for over two years, and I started trading in the mid-90's. Have been through a few brokers during that time. For myself, I am glad I found them and they have worked very well for me. They have Risk Managers on staff with immense real-world experience, who also program the platform to disallow certain actions. Risk managers who work hard to protect both their firm, which was bought by IG by the way, and their traders. Overall I think they do an excellent job. Perhaps the feedback you are receiving about your trades might be a helpful warning sign to you, by a collective who know options way better than many of us on here combined.

That's great, but it's of little consequence. Sosnoff was a terrible floor broker. I don't know WTF you're talking about there.

If they know so much then they should be requiring a haircut on these moronic 0.00 debit/strike width credit verts.

 

[murray t turtle]

Well, I simply wanted to test the platform and my strategies before committing a larger sum towards this. I'm glad I didn't now, as Tastytrade is taking on a hugely authoritive approach, telling me 'They will not be supporting these order types'.
I am not aware of any broker requiring a minimum amount to close a trade. Seems very counterintuitive to me really. If one starts very small, and the strikes prices can be traded effectively, why then would any broker object to a customer placing such trades? That is what I am truly failing to understand.

%%
OK Co1991;
really?? I dont know of any broker , used most of them, that does not require an exit fee.
Includes the days of hi commissions......[maybe a bad idea to paper or pretend trade a 7 figure demo, even if fun]
Actually easy to understand, you work for nothing ??
The giving a gold watch on exits\ that's working for 40 years [slave like]
Its also possible, perhaps, you are such a good trader they hate your gutsLOL;
if thats true, try ETFs, they make a fortune on bid\ask spread,

 

[poopy]

TL;DR?

Poor opens thread stating that a stale mid quote on a *0DTE* bear spread *15% ITM* = arbitraj. He's never going to short at 100. He's locking what is practically an arb-loss.

He's never been filled with a credit = strike width and he never will. Nobody with inventory in this shit is going to sit there and cover their deeps. They are going to let it cross. IOW, there is no flow here. It's the dumbest thing I've ever heard.

So he's filling at a nickel and paying another nickel because he cannot cover. I hope that TT reconsiders and spends this guy's $100 on blow.

The OP is nuts. Nuts.

 

[Cabin1111]

One of about 10 disclosures they have on options.

Enjoy...https://www.theocc.com/getmedia/a151a9ae-d784-4a15-bdeb-23a029f50b70/riskstoc.pdf;

And this is just the governments disclosure. Wait till you get to Tastytrade's disclosures!!

 

[Con1991]

I have used Tastytrade for over two years, and I started trading in the mid-90's. Have been through a few brokers during that time. For myself, I am glad I found them and they have worked very well for me. They have Risk Managers on staff with immense real-world experience, who also program the platform to disallow certain actions. Risk managers who work hard to protect both their firm, which was bought by IG by the way, and their traders. Overall I think they do an excellent job. Perhaps the feedback you are receiving about your trades might be a helpful warning sign to you, by a collective who know options way better than many of us on here combined.

I appreciate your input. I have not been a customer with Tastytrade for very long, in fact I opened the account in January and funded it last week. However my experience so far has not been good. The mobile platform is extremely glitchy, basically unusable. And then as per my post, this dicatatory attitude they seem to take, certainly towards me as a customer so far. Telling me what I can and cannot trade. As far as I'm concerned, if these options are present on an options chain, and there is no risk to the brokerage, then there really shouldn't be an issue with any trades placed.

Why do Tastytrade take such issue with opening a credit spread for the full value of the spread? Or a calendar spread opened for 0 debit, or indeed even a credit. Other brokers do allow this, and for me the fact that Tastytrade frown upon it is a big red flag to me. They have also informed they that they will lift the restriction of closing only, on the clear understanding that I don't place these 'uneconomical' trades again in the future. Like a good boy I must abide by their rules. This is NOT what I expected when I opened my account with them.

 

[Con1991]

TL;DR?

Poor opens thread stating that a stale mid quote on a *0DTE* bear spread *15% ITM* = arbitraj. He's never going to short at 100. He's locking what is practically an arb-loss.

He's never been filled with a credit = strike width and he never will. Nobody with inventory in this shit is going to sit there and cover their deeps. They are going to let it cross. IOW, there is no flow here. It's the dumbest thing I've ever heard.

So he's filling at a nickel and paying another nickel because he cannot cover. I hope that TT reconsiders and spends this guy's $100 on blow.

The OP is nuts. Nuts.

TL;DR?

Poor opens thread stating that a stale mid quote on a *0DTE* bear spread *15% ITM* = arbitraj. He's never going to short at 100. He's locking what is practically an arb-loss.

He's never been filled with a credit = strike width and he never will. Nobody with inventory in this shit is going to sit there and cover their deeps. They are going to let it cross. IOW, there is no flow here. It's the dumbest thing I've ever heard.

So he's filling at a nickel and paying another nickel because he cannot cover. I hope that TT reconsiders and spends this guy's $100 on blow.

The OP is nuts. Nuts.

https://www.reddit.com/r/path%3D%252Fr%252Foptions%252Fcomments%252Frnelfe%252F

Perhaps read this, and then reconsider your statement. Because this is someone who actually managed to execute the strategy I am talking about...

 

[poopy]

https://www.reddit.com/r/path%3D%252Fr%252Foptions%252Fcomments%252Frnelfe%252F

Perhaps read this, and then reconsider your statement. Because this is someone who actually managed to execute the strategy I am talking about...

Bullshit. Those are diagonals.