Intraday buying power

GaryB

GaryB

New member
On Fidelity I have options level 3 in my IRA with limited margin. I keep getting an error when I try to close spreads that I have had on for weeks, you have 0 intraday buying power. I keep 20k in cash in my 150k account.

Do other brokers have this same nonsensical intraday buying power rule that makes it impossible to close spreads? I can make a couple of option trades, and then this will pop up, basically says, sorry, you are done for today, try again tomorrow.

Note this is not pattern day trader violation.

Thanks!
 
Not sure why you have this problem. If you are closing a spread you would not need any buying power
It could be that closing a trade ends up leaving a short leg naked
Another possibility that happened to me once is that if you manually try to close a spread you may have accidentally selected buy to open instead of buy to close on on of the legs which would leave the short in the account naked
You can also send them a message and they can find out what is causing the problem
 
No, this has occurred multiple times, I triple check the order is correct. I keep telling Fidelity they have a bug, they say it's not a bug, it's that my pea brain can't comprehend their incredibly complex margin rules. Then they manually put the order in for me, where they have the override button. The way they've implemented their IRA option rules is just unfriendly to spread traders. I'm guessing their regular margin accounts probably work fine.
 
I did not know they have different rules for IRA accounts

Is the IRA a cash account ?
Can you share a screenshot of the message that pops up ?

I opened a new cash account recently because you are not allowed to have 2 margin accounts at the same brokerage and I found out that you cannot transfer stock from a margin account to a cash account unless you turn off the auto journaling which they can do but it's an extra step Even if you specify a cash type trade it's automatically changed to a margin trade
Maybe it's something along those lines
 
After more research.... intraday buying power restrictions are imposed after a pattern day trading violation occurs. Fidelity's calculation is much more restrictive than required by FINRA, and buggy as well. Once you get tagged as PDT in an IRA at Fidelity, you will have difficulties.
 
So did you get tagged as a PDT ?
Even if you are in a regular account (not IRA) and you get tagged as a PDT you will have difficulty at any brokerage
You said you have 20k cash If you could increase that past 25k that should alleviate the problem
 
Fidelity somewhat fixed the problem by changing all my positions to margin. My cash positions messed up their algorithm.
 
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