The Unofficial Options Trading / Guide Thread

I am hoping to start a thread where people can post/share valuable resources on options / option trading. Here are some that I have gathered from a few weeks back (from RFD, readings and online searches). Had I know about some of these, I probably wouldn't be losing out on an option trade I made but didn't close out at a decent profit when I had the chance to. I will update this first post for links that other RFD members will have provided. Feel free to share some of your option trading strategies as well though I've only been a call option buyer on my registered accounts since July, thankfully when stock volatility had plummeted to their yearly low (thus far).

The Options Industry Council:
http://www.optionseducation.org/

Historical Volatility spreadsheet from Peter...:
http://www.optiontradingtips.com/opt...omments_anchor

Option price history from BigCharts:
http://bigcharts.marketwatch.com/int...b=&time=&freq=
where symbol is HOV=RA for HOVRA for example (credit goes to http://answers.yahoo.com/question/in...1041333AAHfbu0)

Option pricing from Ivolatility:
http://www.ivolatility.com/calc/

Free Calculators, Volatility Data, etc. :
http://www.optionstrategist.com/free...sis/index.html

Reserved for future posts.

Besides books by Charles M Cottle, Jeff Augen and Lawrence G. McMillan, are there other noteworthy authors/authorities on option trading?

Anyone know if there is any brokerage that allows the writing of naked calls / puts for registered accounts (rrsp, tfsa, resp)?

Originally Posted by mietief

Anyone know if there is any brokerage that allows the writing of naked calls / puts for registered accounts (rrsp, tfsa, resp)?

I don't think any broker will - essentially uncovered options are not qualified investments for registered plans...

http://www.cra-arc.gc.ca/E/pub/tp/it...tml#P214_33642

23. The writing of a naked call option, whereby a plan trust sells a call option in respect of an underlying property which it does not own, may result in the plan trust being considered to be carrying on a business. The same result may arise where a plan trust engages in a short sale, i.e., the plan trust sells property that it does not own. An RESP that is carrying on a business is revocable. An RRSP or a RRIF will be liable for income tax on its taxable income for any year in which it is carrying on a business.

Originally Posted by monty613

I don't think any broker will - essentially uncovered options are not qualified investments for registered plans...

http://www.cra-arc.gc.ca/E/pub/tp/it...tml#P214_33642

Thanks for the info!

What's the most lenient brokerage for granting a high level (3 or 4) of trading authorization? If I deposit $25k and claim to have experience, will Questrade or IB typically grant me this authorization?

I want to start off by writing puts.

Originally Posted by Anonymouse

What's the most lenient brokerage for granting a high level (3 or 4) of trading authorization? If I deposit $25k and claim to have experience, will Questrade or IB typically grant me this authorization?

I want to start off by writing puts.

With TD I had to answer three or four questions and got level 4 no problem. They were all pretty easy if you understand options. The ones I can remember are:

-A call is a contract to buy or sell a stock at a future date? (buy)
-The potential loss on a naked call is? (unlimited)
-What is the margin requirement on naked options? (30% of the underlying stock price + option premium - amount out of the money)

And to add to the original topic, 888options.com is great, position simulators, good quotes with all the greeks, etc.

Which Canadian online brokerage allows for spreads or multi-leg option trades to be entered?

For US brokerages, is IB hands down the best in terms of ease of option order entry?

Originally Posted by Anonymouse

What's the most lenient brokerage for granting a high level (3 or 4) of trading authorization?

What exactly is level 3 or 4 trading authorization? My apologies but I've got option trading set up on my margin account but have so far only traded options in my registered accounts.

Originally Posted by alanbrenton

Which Canadian online brokerage allows for spreads or multi-leg option trades to be entered?

Definitely not TD, it's a giant pain in the ass. You have to call them up and they give you the online rate over the phone to enter a spread order...but why not just set it up online?

Originally Posted by alanbrenton

What exactly is level 3 or 4 trading authorization? My apologies but I've got option trading set up on my margin account but have so far only traded options in my registered accounts.

I believe level 1 only allows outright call/put purchases and covered calls, level 2 or 3 allows spreads and level 4 allows naked writing.