Question RE: SPX options with Schwab and Tastyworks

A

AmyM

Amy Meissner
Aeromir Expert
Hi. Hoping someone can share some info about trading SPX options at Schwab. I currently have an account at Tastyworks, but trade large amount of contracts so always looking to lower costs and also find that execution at Tastyworks of an SPX option order with 50 contracts or more on any leg of the order goes to manual mode where they send the trade manually to the floor. It takes forever to cancel and replace if needed once this happens or to find out if it filled, so it's tough for me when I'm entering 200 or more contract spreads. This is only for the SPX but it's what I trade. So wondering how Schwab is handling SPX option orders. Execution speed, large contract sizes, etc.?? Have a small account there and thought I'd give it a try even though the trading platform is so so. Thanks! Amy
 
Hi, orders executions are very fast ,big size not a problem ,commissions in line with IB and TD(part of Schwab group).
 
Execution is very decent, but I did not try 50+ contracts.
Commissions actually I think is better than in tastyworks.
tastyworks takes $0.5 to open + $0.75 fee + $0.75 fee to close.
Schwab takes $0.65 to open and $0.65 to close and no fee.
 
When I talked to the Schwab rep last week he said the commissions on the SPX are negotiable for accounts over 200,000. Tim Pearson trades on Schwab, so maybe he could chime in on this.
 
NoMoWork said:
When I talked to the Schwab rep last week he said the commissions on the SPX are negotiable
Click to expand...
I am not aware of any commissions on SPX
Do you mean the regular option commission of 65 cents maybe ?
There is no SPX index fee charged at Schwab like at ather brokerages
 
Sorry, I should have said fees instead of commissions. I was referring to their .65 per SPX contracts.
SergB. Good info on complete cost of trading SPX options with different brokers.
Can someone using IB update us on their total charges for trading the SPX?
 
NoMoWork said:
I was referring to their .65 per SPX contracts.
Click to expand...
Just to clarify Schwab does not charge any index fees for SPX
They only have the 65 cents commission for all options There is no additional fees for indexes (SPX, RUT) like other brokerages
Are you perhaps referring to TD Ameritrade fees which even though they merged with Schwab they still charge separate fees for SPX
 
I have had problems trading an IRA account at Schwab. I was trading put butterflies... initial trade was executed ok but when I went to adjust it I would get an error message and would have to call the trade desk to get my adjustment executed. I have since figured out that I do not have problems (or not yet) with Iron Butterflies. Also, you can not trade calendars in an IRA.
 
It wasn't a PDT message. It said my account wasn't allowed to do that trade which was only a vertical (moving some or all of my upper longs in a put butterfly). The trade desk could do it for me so my account was allowed to do it. They said it was a known problem in IRA accounts and they were working on the problem. After 3 or 4 times, I wised up and tried an iron butterfly and haven't had any more problems, but I always hold my breath when adjusting a trade.
 
Thanks for clarifying
There was someone else here who had similar issues with IRA account at a different brokerage something about intraday buying power restriction after a PDT violation
Probably most brokerages are somewhat more strict with IRA accounts
 
I've never had any problems with an IRA account with TOS and hope to have none with Tastyworks which I recently opened. I get a great rate from Schwab so it still makes sense to use them as long as I'm careful.
 
I would say TOS and Tastyworks are much better at handling margin than other brokerages and maybe more lenient on IRA accounts
Some brokers require extra margin or have higher account to begin with when trading calendars and diagonals also they may not use the debit side to balance the margin on BWB and charge the full margin for the credit side and that's even for regular non IRA accounts
 
I have schwab and IB, probably can't compare the two since I have more capital at IB, but generally feel the execution is quicker on IB and the margin costs are less.
 
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