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Diversified Option Selling Portfolio


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Diversified Option Selling Portfolio

 
 ron99 
Cleveland, OH
 
Experience: Advanced
Platform: QST
Broker: QST, DeCarley Trading, Gain
Trading: Options on Futures
Posts: 3,081 since Jul 2011
Thanks Given: 980
Thanks Received: 5,785


swisstrader321 View Post
I have a question, not about a specific trader, but more about your broker of choice DeCarley. I also contacted them about an account and their fees are a bit out of line if you ask me. The one that totally turned me off was the 25usd fee to wire funds out? I think that is out of line in this day and age.

I currently use IB. Which also uses SPAN so I don't quite see the advantage of using DeCarley.

Are there any advantages that I am not aware of if you do your own analysis and place your own trades?

Thanks

The money you save at IB in commissions and wire fees (how often do you move money?) will be more than made up by being able to do more trades because of the vastly lower margin requirements at DeCarley.


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 swisstrader321 
Zurich
 
Experience: Advanced
Platform: IB
Trading: Futures
Posts: 48 since Jun 2011
Thanks Given: 31
Thanks Received: 21


ron99 View Post
The money you save at IB in commissions and wire fees (how often do you move money?) will be more than made up by being able to do more trades because of the vastly lower margin requirements at DeCarley.

I normally try to withdraw once a month.

I thought DeCarley also uses SPAN margin? Same as IB right?

 
 ron99 
Cleveland, OH
 
Experience: Advanced
Platform: QST
Broker: QST, DeCarley Trading, Gain
Trading: Options on Futures
Posts: 3,081 since Jul 2011
Thanks Given: 980
Thanks Received: 5,785



swisstrader321 View Post
I normally try to withdraw once a month.

I thought DeCarley also uses SPAN margin? Same as IB right?

On short options IB is 3-4x or higher than SPAN margin. IB may be higher on futures too. DeCarley is always at SPAN margin levels. Do a search on this thread or the Selling options thread for IB. You will see many examples of how much higher than SPAN IB has it margins at.

 
 swisstrader321 
Zurich
 
Experience: Advanced
Platform: IB
Trading: Futures
Posts: 48 since Jun 2011
Thanks Given: 31
Thanks Received: 21


ron99 View Post
On short options IB is 3-4x or higher than SPAN margin. IB may be higher on futures too. DeCarley is always at SPAN margin levels.

That is good to know, I was not aware. Thank you

 
 ron99 
Cleveland, OH
 
Experience: Advanced
Platform: QST
Broker: QST, DeCarley Trading, Gain
Trading: Options on Futures
Posts: 3,081 since Jul 2011
Thanks Given: 980
Thanks Received: 5,785


swisstrader321 View Post
That is good to know, I was not aware. Thank you

IB will also automatically exit you from positions at market price (bad for options) if you hit margin call with their ever moving margin rate.

 
 
SMCJB's Avatar
 SMCJB 
Houston TX
Legendary Market Wizard
 
Experience: Advanced
Platform: TT and Stellar
Broker: Advantage Futures
Trading: Primarily Energy but also a little Equities, Fixed Income, Metals and Crypto.
Frequency: Many times daily
Duration: Never
Posts: 5,041 since Dec 2013
Thanks Given: 4,375
Thanks Received: 10,192


swisstrader321 View Post
but refuse to fund it based on the 25usd a wire fee. That is just outright wrong. A bank wire is absolutely no work this day and age.

You sure that's to wire IN? Wire OUT fees are common but not wire in. You can often avoid wire out fees by using ACH/ETF. Of course my bank charges me to wire out!

 
 ron99 
Cleveland, OH
 
Experience: Advanced
Platform: QST
Broker: QST, DeCarley Trading, Gain
Trading: Options on Futures
Posts: 3,081 since Jul 2011
Thanks Given: 980
Thanks Received: 5,785


SMCJB View Post
You sure that's to wire IN? Wire OUT fees are common but not wire in. You can often avoid wire out fees by using ACH/ETF. Of course my bank charges me to wire out!

DeCarley has no fee to wire in. Only out. DeCarley does not offer ACH.

My bank charges me $25 to wire in and out.

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 swisstrader321 
Zurich
 
Experience: Advanced
Platform: IB
Trading: Futures
Posts: 48 since Jun 2011
Thanks Given: 31
Thanks Received: 21


SMCJB View Post
You sure that's to wire IN? Wire OUT fees are common but not wire in. You can often avoid wire out fees by using ACH/ETF. Of course my bank charges me to wire out!

My bank also charges me to wire out but it's a nominal fee. IB offers one free wire a month which is fair.

Maybe I'm not being fair. I wasn't aware of the margin benefits for writing options.

Thanked by:
 
 
SMCJB's Avatar
 SMCJB 
Houston TX
Legendary Market Wizard
 
Experience: Advanced
Platform: TT and Stellar
Broker: Advantage Futures
Trading: Primarily Energy but also a little Equities, Fixed Income, Metals and Crypto.
Frequency: Many times daily
Duration: Never
Posts: 5,041 since Dec 2013
Thanks Given: 4,375
Thanks Received: 10,192


ron99 View Post
DeCarley has no fee to wire in. Only out. DeCarley does not offer ACH.

My bank charges me $25 to wire in and out.

My bank actually waives my wire fees, but I have most of my excess cash in their investment side and they do charge for wires. So if it's an urgent wire I pay the fee, if not I transfer to checking and get the free wire.


swisstrader321 View Post
My bank also charges me to wire out but it's a nominal fee. IB offers one free wire a month which is fair.

Maybe I'm not being fair. I wasn't aware of the margin benefits for writing options.

IB are infamous for having very bad margin rates on options, and are very quick (and often expensive) to force liquidate positions.

Thanked by:
 
 myrrdin 
Linz Austria
 
Experience: Advanced
Platform: TWS
Broker: Interactive Brokers
Trading: Commodities
Posts: 1,938 since Nov 2014
Thanks Given: 3,686
Thanks Received: 2,651



swisstrader321 View Post
I have a question, not about a specific trader, but more about your broker of choice DeCarley. I also contacted them about an account and their fees are a bit out of line if you ask me. The one that totally turned me off was the 25usd fee to wire funds out? I think that is out of line in this day and age.

I currently use IB. Which also uses SPAN so I don't quite see the advantage of using DeCarley.

Are there any advantages that I am not aware of if you do your own analysis and place your own trades?

Thanks

I prefer holding 2 or 3 accounts to avoid third party risk. Consequently, I need 1 or 2 additional brokers to Interactive Brokers.

There are several advantages of DeCarley compared to Interacitve Brokers:
The service is outstanding. Even in case you have a self directed account Carley places trades for you in cases you are not in a position to do so. Eg. on Sunday evening (New York Time), when we are sleeping in good old Europe. And on many other occasions. You get assistance within minutes, whereas at Interactive Brokers you have to wait for days. When there is a large overnight gap (eg. after a report), at Interactive Brokers you are not free to place your order between actual bid /ask before the open. They only allow a value in the order of magnitude of the day before. DeCarley uses SPAN, whereas Interactive Brokers do not use SPAM in all cases. For naked short options there margin is significantly higher, and in case they consider your portfolio as too risky, they add a special daily fee. Interactive Brokers uses forced liquidation intraday, whereas at DeCarley you usually get one additional day to close positions on your own in case there is no major problem. At DeCarley you receive research free of charge, eg. the Hightower Report, including a lot of fundamental information, and her own research. Both include detailed trade suggestions.

The fee for money wires does not bother me, as I very rarely wire money. In case I need money I take it from the Interactive Brokers account.

The major disadvantage of DeCarley compared to Interactive Brokers for Austrians is that DeCarley is not in a position to offer reporting in Euro. This raises costs for the tax advizer significantly.

In case of further questions, please feel free to ask.

Best regards, Myrrdin

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Last Updated on May 26, 2022


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