Questions about opening options account...
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Questions about opening options account... Hi everyone, About 2 - 3 weeks ago, I started the process of getting approval for options trading at Vanguard (since we already had accounts there). To apply, I had to print a form from Vanguard's website, complete the application and mail it in (I was disappointed that I couldn't apply online). Finally this week, they mailed us the approval letter/info. I was disappointed to find out that I must TELEPHONE them to place a PUT. They then segregate the money for the Put into a separate money market account. A BTC can be placed with their online system. However, to have the money released back into my own account to i.e. buy a stock outright, I have to TELEPHONE them & ask for the money to be released which can take 24 hours. Is this normal? I'd appreciate any advice. Option Trading fees: If you have under $50,000 of assets in Vanguard funds, then they charge $20 + $1 per contract. If 50,000 - 500,000 in Vanguard Funds, then they charge $7 +$1 per contract. I should have asked more questions upfront. I'm definitely considering looking at other brokerages. This process is turning out to be more of a hassle than I would have expected. Theresa Wow, Theresa, that sounds very onerous. I can speak from experience with two brokers. Eighteen months ago, I was brand new to investing and set up an online account with TD Ameritrade. I asked for permission to trade cash-secured puts and covered calls right off the bat, and it was granted. I like TD Ameritrade's research capabilities, market and ticker news, charting, etc., and I still use that brokerage, but I found the commissions a little steep for frequent options trading. So I opened an OptionsHouse account earlier this year. Probably not as many bells and whistles, but as the name implies, it caters to options traders. I've been very happy with OH, especially the pricing structure for both stock and option trades. Here's a link to Barron's 2012 review of online brokers: http://online.barrons.com/article/SB50001424052748704759704577267660673833538.html#articleTabs_article%3D1 --Ron -----Original Message----- From: cool_club@bivio.com [mailto:cool_club@bivio.com] On Behalf Of Theresa H Sent: Monday, October 08, 2012 6:19 PM To: cool_club@bivio.com Subject: [cool_club] Questions about opening options account... Hi everyone, About 2 - 3 weeks ago, I started the process of getting approval for options trading at Vanguard (since we already had accounts there). To apply, I had to print a form from Vanguard's website, complete the application and mail it in (I was disappointed that I couldn't apply online). Finally this week, they mailed us the approval letter/info. I was disappointed to find out that I must TELEPHONE them to place a PUT. They then segregate the money for the Put into a separate money market account. A BTC can be placed with their online system. However, to have the money released back into my own account to i.e. buy a stock outright, I have to TELEPHONE them & ask for the money to be released which can take 24 hours. Is this normal? I'd appreciate any advice. Option Trading fees: If you have under $50,000 of assets in Vanguard funds, then they charge $20 + $1 per contract. If 50,000 - 500,000 in Vanguard Funds, then they charge $7 +$1 per contract. I should have asked more questions upfront. I'm definitely considering looking at other brokerages. This process is turning out to be more of a hassle than I would have expected. Theresa I agree with Ron about OptionsHouse. I have also used Scottrade although they too have a weird setup for option trading. As for Vanguard, they do what they can to discourage short term trading in any form. For example, they don't even allow the use of trailing stops. Although I have accounts there, I have never traded any options with Vanguard. The option centric brokers, like OptionsHouse, will be best for your purposes. Saul... Sent from my  iPad 2 On Oct 9, 2012, at 7:54 AM, "Elliott, Ron" <ron.elliott@okstate.edu> wrote: > Wow, Theresa, that sounds very onerous. I can speak from experience with two brokers. Eighteen months ago, I was brand new to investing and set up an online account with TD Ameritrade. I asked for permission to trade cash-secured puts and covered calls right off the bat, and it was granted. I like TD Ameritrade's research capabilities, market and ticker news, charting, etc., and I still use that brokerage, but I found the commissions a little steep for frequent options trading. So I opened an OptionsHouse account earlier this year. Probably not as many bells and whistles, but as the name implies, it caters to options traders. I've been very happy with OH, especially the pricing structure for both stock and option trades. > > Here's a link to Barron's 2012 review of online brokers: > > http://online.barrons.com/article/SB50001424052748704759704577267660673833538.html#articleTabs_article%3D1 > > --Ron > > > -----Original Message----- > From: cool_club@bivio.com [mailto:cool_club@bivio.com] On Behalf Of Theresa H > Sent: Monday, October 08, 2012 6:19 PM > To: cool_club@bivio.com > Subject: [cool_club] Questions about opening options account... > > Hi everyone, > > About 2 - 3 weeks ago, I started the process of getting approval for options trading at Vanguard (since we already had accounts there). To apply, I had to print a form from Vanguard's website, complete the application and mail it in (I was disappointed that I couldn't apply online). Finally this week, they mailed us the approval letter/info. > > I was disappointed to find out that I must TELEPHONE them to place a PUT. They then segregate the money for the Put into a separate money market account. A BTC can be placed with their online system. However, to have the money released back into my own account to i.e. buy a stock outright, I have to TELEPHONE them & ask for the money to be released which can take 24 hours. Is this normal? I'd appreciate any advice. > > Option Trading fees: If you have under $50,000 of assets in Vanguard funds, then they charge $20 + $1 per contract. If 50,000 - 500,000 in Vanguard Funds, then they charge $7 +$1 per contract. > > I should have asked more questions upfront. I'm definitely considering looking at other brokerages. This process is turning out to be more of a hassle than I would have expected. > > Theresa > > Thanks Ron & Saul for your input. The Barron's article is a great resource! I'm now in compare & contrast mode. I'm hoping to do options trading within my IRA, so before I go to all the trouble of transferring to a new brokerage, I want to make sure it fits my needs. Any other tips, advice, or "watch out for..." info is greatly appreciated. Theresa On Oct 8, 2012, at 8:42 PM, Saul Seinberg wrote: > I agree with Ron about OptionsHouse. I have also used Scottrade although they too have a weird setup for option trading. > > As for Vanguard, they do what they can to discourage short term trading in any form. For example, they don't even allow the use of trailing stops. Although I have accounts there, I have never traded any options with Vanguard. The option centric brokers, like OptionsHouse, will be best for your purposes. > > Saul... > > Sent from my  iPad 2 > > On Oct 9, 2012, at 7:54 AM, "Elliott, Ron" <ron.elliott@okstate.edu> wrote: > >> Wow, Theresa, that sounds very onerous. I can speak from experience with two brokers. Eighteen months ago, I was brand new to investing and set up an online account with TD Ameritrade. I asked for permission to trade cash-secured puts and covered calls right off the bat, and it was granted. I like TD Ameritrade's research capabilities, market and ticker news, charting, etc., and I still use that brokerage, but I found the commissions a little steep for frequent options trading. So I opened an OptionsHouse account earlier this year. Probably not as many bells and whistles, but as the name implies, it caters to options traders. I've been very happy with OH, especially the pricing structure for both stock and option trades. >> >> Here's a link to Barron's 2012 review of online brokers: >> >> http://online.barrons.com/article/SB50001424052748704759704577267660673833538.html#articleTabs_article%3D1 >> >> --Ron >> >> >> -----Original Message----- >> From: cool_club@bivio.com [mailto:cool_club@bivio.com] On Behalf Of Theresa H >> Sent: Monday, October 08, 2012 6:19 PM >> To: cool_club@bivio.com >> Subject: [cool_club] Questions about opening options account... >> >> Hi everyone, >> >> About 2 - 3 weeks ago, I started the process of getting approval for options trading at Vanguard (since we already had accounts there). To apply, I had to print a form from Vanguard's website, complete the application and mail it in (I was disappointed that I couldn't apply online). Finally this week, they mailed us the approval letter/info. >> >> I was disappointed to find out that I must TELEPHONE them to place a PUT. They then segregate the money for the Put into a separate money market account. A BTC can be placed with their online system. However, to have the money released back into my own account to i.e. buy a stock outright, I have to TELEPHONE them & ask for the money to be released which can take 24 hours. Is this normal? I'd appreciate any advice. >> >> Option Trading fees: If you have under $50,000 of assets in Vanguard funds, then they charge $20 + $1 per contract. If 50,000 - 500,000 in Vanguard Funds, then they charge $7 +$1 per contract. >> >> I should have asked more questions upfront. I'm definitely considering looking at other brokerages. This process is turning out to be more of a hassle than I would have expected. >> >> Theresa >> >> Hi Theresa, I have used several different brokers over the years, both for clubs and for personal accounts. I have used Schwab for a very long time for IRA's. I really like them. They provide lots of research material and their representatives are very nice and very knowledgeable. I've also used TDAmeritrade and E*Trade in the past and had good experiences with both of them. I've found Schwab to work very well for options trades. They are not the cheapest, but they are not the most expensive either. Since I'm just learning and since the COOL Tool takes options costs into account, it's been working fine for me. This is a timely topic since Paul will be discussing getting set up at your brokerage this week. It's really nice for everyone to share their experiences. They are all a little different and sometimes getting set up is one of the obstacles to doing this in the first place. Laurie Frederiksen Invest with your friends! www.bivio.com Become our Facebook friend! www.facebook.com/bivio Follow us on twitter! www.twitter.com/bivio On Tue, Oct 9, 2012 at 10:26 AM, Theresa H <breezytreeshome@gmail.com> wrote: Thanks Ron & Saul for your input. The Barron's article is a great resource! I'm now in compare & contrast mode. I'm hoping to do options trading within my IRA, so before I go to all the trouble of transferring to a new brokerage, I want to make sure it fits my needs. Theresa I like to echo what Laurie said about Schwab. I used them for years and all the trading I do is in my IRA. If I have any problems or questions there customer service has always been good. CHUCK B From: Laurie Frederiksen <laurie@bivio.biz> To: cool_club@bivio.com Sent: Tuesday, October 9, 2012 11:06 AM Subject: Re: [cool_club] Thanks for brokerage advice Hi Theresa, I have used several different brokers over the years, both for clubs and for personal accounts. I have used Schwab for a very long time for IRA's. I really like them. They provide lots of research material and their representatives are very nice and very knowledgeable. I've also used TDAmeritrade and E*Trade in the past and had good experiences with both of them. I've found Schwab to work very well for options trades. They are not the cheapest, but they are not the most expensive either. Since I'm just learning and since the COOL Tool takes options costs into account, it's been working fine for me. This is a timely topic since Paul will be discussing getting set up at your brokerage this week. It's really nice for everyone to share their experiences. They are all a little different and sometimes getting set up is one of the obstacles to doing this in the first place. Laurie Frederiksen Invest with your friends! http://www.bivio.com/ Become our Facebook friend! www.facebook.com/bivio Follow us on twitter! www.twitter.com/bivio On Tue, Oct 9, 2012 at 10:26 AM, Theresa H <breezytreeshome@gmail.com> wrote: Thanks Ron & Saul for your input. The Barron's article is a great resource! I'm now in compare & contrast mode. I'm hoping to do options trading within my IRA, so before I go to all the trouble of transferring to a new brokerage, I want to make sure it fits my needs. I've been a Charles Schwab client for over 15 years. I appreciate the extensive resources available, the online security measures, and the fees. Enabling my IRA and investment accounts recently for option trading took four days with no problems. I've been with my 'broker' (account representative) for five years and can go in to talk, phone or email him any time. If I call for help or concern, the support teams are very professional, personable and have worked through any concern I've had with my accounts (changing passwords, etc). It is your money. People know more about their barber than their investment firm. Make appointments to talk with people and take the time to go in and see how the place runs. I get more from looking at a guys car and desk than anything he tells me. FYI my brother was an IT officer for Fischer Investments. The 'brokers' had one tool I didn't know was necessary - a putter. They used headsets to make cold calls and would play cubical golf while making calls. He left after a year because of the unprofessional office environment. I recommend Schwab. I have no experience w other firms except Vanguard for an employer directed 401k. Get reports and nothing more. Good luck with your decision. It's a pain to move but you're doing it right! Malcolm Sent from my Communicator
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