# Best online options brokers for Australia?



## long88

Hi all, just wondering what most of the people use here for their options trading ? now that Optionsxpress is gone, how are you guys going to place your next trade ?

i have been using OX for sometimes, and now have to move to etrade (which cost a bomb).

Can anyone share their broker with me, and any recomendations ? features ? good or bad ?

Thx


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## sails

*Re: Best online Options Brokers for Aussie?*

There's a recent thread on this: https://www.aussiestockforums.com/forums/showthread.php?t=13731

Cheers


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## long88

*Re: Best online Options Brokers for Aussie?*

thx sails.

but no one really comment on the brokers that they use, it looks like the best one so far is still OX ? in terms of fee and multiple legged.

i am trying to execute ratio backspread on etrade, and cannot do it online, i dont know whether i can do it on the phone. but i end up on different strike price in order to execute 3 legged or 4 legged options, and cost of brokerage ($45 for each leg), not really happy about it, but what can you do ? anyone else out there ?


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## cutz

*Re: Best online Options Brokers for Aussie?*

Hi Long888,

I been using commsec for a little while now to find my feet in the options bizz, trades are $34.95 per leg which isn't the cheapest but customer service is good and they provide webiress which is a cool options platform for ease of operation. The downside is they charge excessive brokerage for exercise/assignment but i avoid those.

I've just set up with IB which i will be easing into. I'm not 100% sure on the margining process but i guess when i'm ready i see how it goes.

Hope that helps.


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## Grinder

*Re: Best online Options Brokers for Aussie?*

Long888,

Trade abit bigger lots, say over 20 per leg then the flat fee can end up cheaper than the rate per cons, but anything less would probs end up more pricey. Dont know the size you trade but food for thought.


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## cutz

*Re: Best online Options Brokers for Aussie?*

A question i've been holding back on for a while but here it is,

I've been doing spreads for a while, mostly 2 leggers, one leg at a time as iress doesn't do spreads.

What's the advantage of having software that can do a spread in one hit as opposed to two seperate trades?


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## sails

*Re: Best online Options Brokers for Aussie?*



long88 said:


> thx sails.
> 
> but no one really comment on the brokers that they use, it looks like the best one so far is still OX ? in terms of fee and multiple legged.
> 
> i am trying to execute ratio backspread on etrade, and cannot do it online, i dont know whether i can do it on the phone. but i end up on different strike price in order to execute 3 legged or 4 legged options, and cost of brokerage ($45 for each leg), not really happy about it, but what can you do ? anyone else out there ?




Is it worth trading the vertical spread and then trading the extra long separately?  I guess the only catch is they would probably charge you two lots of fees for the long if it is a small position - would depend on size and etrade's commission structure.  Otherwise phone and ask if it can be done online...


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## sails

*Re: Best online Options Brokers for Aussie?*



cutz said:


> A question i've been holding back on for a while but here it is,
> 
> I've been doing spreads for a while, mostly 2 leggers, one leg at a time as iress doesn't do spreads.
> 
> What's the advantage of having software that can do a spread in one hit as opposed to two seperate trades?




Usually save on slippage 

Edit:  Works best if you are buying one and selling the other as opposed to buying or selling a straddle/strangle.  It also protects the position should the market make fast move against you just after you have put the first leg on!


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## cutz

*Re: Best online Options Brokers for Aussie?*

Yep,

I see what you mean, sometimes is does take time to put through a couple of legs.


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## cutz

*Re: Best online Options Brokers for Aussie?*

Normally i waste time by putting my order just inside the spread like 1 point and slowly moving it till its gets filled, then i do the same again on the other leg so it all adds up in lost time, not good when the underlying is moving quick.

This is a pointless yeah, should i just be placing the orders right in the middle or should i just meet the prices and be done with it? (except for when the spreads are excessively wide of course)


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## sails

*Re: Best online Options Brokers for Aussie?*



cutz said:


> Normally i waste time by putting my order just inside the spread like 1 point and slowly moving it till its gets filled, then i do the same again on the other leg so it all adds up in lost time, not good when the underlying is moving quick.
> 
> This is a pointless yeah, should i just be placing the orders right in the middle or should i just meet the prices and be done with it? (except for when the spreads are excessively wide of course)




Yes, it can take up a lot of time trying to work both orders - would be another advantage of trading the combo.

When I first traded options, it was necessary to leg in and used WebIress for trading.  I used to have both market depth windows displayed and then would work one side of the spread - usually going to the mid point fairly quickly to see if there were any takers.  Sometimes you can be lucky and another retail trader will take your price.  Sometimes it's worth watching the two market depth windows for a while to see if there are any retail orders that come in close to the mid price and at least get one side of the order filled there.

One would imagine that if the MM sees you slowly ticking down, they are going to leave you as long as possible - unless there are a few different MM firms giving a bit of competition.  All guesswork as I have never seen how the MMs work on their side of things.

I still do leg in at times.  If I see a retail order bidding or offering at a better price than I can get from the MM, I will go for it .

To work out a combo price, I usually take the mid price of both and subtract that - then hopefully you can get the order taken with only a small amount of slippage from that mid point.  Usually far less slippage than just trading the relevant bid and ask.  To save getting the calculator out each time, you can fairly quickly find the average of the difference between the two bid prices and the two ask prices.

Eg.  call vertical.  
Option 1 bid/ask = 30/36
Option 2 bid/ask = 15/18
Spread bid = 15 / spread ask = 18 
Average mid point for spread = 16.5
Works out the same as the conventional way, but a quick way when visually scanning an option chain.
Might not suit everyone - just something I've found useful.

If phoning the order through, it's a nuisance to keep calling the broker every time you want to amend the order.  With TD, once they have the order set up, they give me the code for that particular combo (only good for the day) and then I am able to amend, delete, re-order as I would any single option order.  I really like that bit.  Sometimes you can see other orders, and sometimes the MM brings a counter bid or offer which is very helpful.  Perhaps you could try a phone order with Commsec and you should be able find the spread code in your order under "Security" in your Order Status window.  But ask first as they may not show the spread order through your Iress - and you would have to weigh up the cost of higher phone order fees vs. what you could save on the spread.

I don't think you can see the market depth window for spreads with IB so you wouldn't know if a MM put in a counter bid/ask, however, you can amend, etc quite easily.

Longer post than I thought     -  hope it helps


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## cutz

*Re: Best online Options Brokers for Aussie?*

Thanks for the info on order placement Sails,

Unfortunately my iress doesn't have a security tab under Order Status, just outstanding/executed/cancelled.

So in your case you bring up your outstanding spread in the Order Status,
amend and send it through in one hit.


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## sails

*Re: Best online Options Brokers for Aussie?*



cutz said:


> Thanks for the info on order placement Sails,
> 
> Unfortunately my iress doesn't have a security tab under Order Status, just outstanding/executed/cancelled.
> 
> So in your case you bring up your outstanding spread in the Order Status,
> amend and send it through in one hit.




Below is a snapshot of my Order Status.  Found by clicking on "Orders" on the main Iress Toolbar.  I use it all the time when trading.  Haven't done any trades today - but it gives the idea.

The first column "Security" is where the spread code appears - otherwise this is normally just the single option code or a stock code.  However, once the spread order is completed, it then shows the actual option legs that have traded.


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## Grinder

*Re: Best online Options Brokers for Aussie?*



sails said:


> To work out a combo price, I usually take the mid price of both and subtract that - then hopefully you can get the order taken with only a small amount of slippage from that mid point.  Usually far less slippage than just trading the relevant bid and ask.  To save getting the calculator out each time, you can fairly quickly find the average of the difference between the two bid prices and the two ask prices.
> 
> Eg.  call vertical.
> Option 1 bid/ask = 30/36
> Option 2 bid/ask = 15/18
> Spread bid = 15 / spread ask = 18
> Average mid point for spread = 16.5
> Works out the same as the conventional way, but a quick way when visually scanning an option chain.
> Might not suit everyone - just something I've found useful.
> 
> QUOTE]
> 
> or if ya up for some basic excel calculations u can wack in what sails mentioned in a spreadsheet for quicker use, it prevents stuff ups.


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## long88

*Re: Best online Options Brokers for Aussie?*

Hi all.

Thx for the reply.

i believe etrade charge each trade as per trade, doesnt matter whether it is big or small (if it is small trade, $45, and if it is big, it is based on %).

and it is usually good to get the trade executed at once, based on net credit or debit that you will receive, so it doesnt matter the price spread anymore.

I usually trade for credit, and biggest that i have now is 10 lot only, dont want to go really big, as i still green here, still learning.

so it looks like we are stuck here with the banks (etrade, comsec ?)

i have tricom (live spectrum), but not that familiar with their trader Workstation, and it also need subscription ($30/month), not sure about their brokerage, have to find out.


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## cutz

*Re: Best online Options Brokers for Aussie?*



sails said:


> Below is a snapshot of my Order Status.  Found by clicking on "Orders" on the main Iress Toolbar.  I use it all the time when trading.  Haven't done any trades today - but it gives the idea.
> 
> The first column "Security" is where the spread code appears - otherwise this is normally just the single option code or a stock code.  However, once the spread order is completed, it then shows the actual option legs that have traded.




Hi Sails,

Yep mine is a bit different, must be a slightly scaled back version.


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## sails

*Re: Best online Options Brokers for Aussie?*



cutz said:


> Hi Sails,
> 
> Yep mine is a bit different, must be a slightly scaled back version.




Hi Cutz - I think Iress may allow brokers to customize the platform to their invidicual needs / wants.  Could explain why yours is different.


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## cutz

*Re: Best online Options Brokers for Aussie?*

Hi Sails,

Do your orders appear on the market quickly, mine sometimes seem to take forever, i could understand that the desk guys may want to check my available margins on short positions but even buying back shorts or buying longs sometimes take time. I initially thought that iress was straight through.


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## boeingdriver

*Re: Best online Options Brokers for Aussie?*

Hi, first post just found this forum, very impressed so far.
Try interactive brokers, the cost per trade on the Australian market is $3.00
http://individuals.interactivebrokers.com/en/main.php
I have not opened an account with them yet (you need $10000 ) usd or the equivilent in OZ dollars plus abt $34.00/month for a live data feed. At the moment I pay $45.00 a trade with Austock and $24 a month to weblink for their live feed so costs look pretty good. If you want to trade the US market its $1 usd a trade.
I intend to open an account in the New Year and close my Austock account then.The only negative I have found so far is that they are not covered by the asx ? but are covered up to $30 million for stocks and $1 million for cash in your account see this link
http://www.interactivebrokers.com/en/accounts/accountProtection.php?ib_entity=llc
Hope this helps


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## sails

*Re: Best online Options Brokers for Aussie?*



cutz said:


> Hi Sails,
> 
> Do your orders appear on the market quickly, mine sometimes seem to take forever, i could understand that the desk guys may want to check my available margins on short positions but even buying back shorts or buying longs sometimes take time. I initially thought that iress was straight through.




Yep Cutz - very fast for online ordering of single options.  I'm pretty sure it's not straight through processing with options, but TD's brokers do a great job of authorising them quickly.  But then they don't allow any naked writes, so I guess they don't have to go and check margins! Think it's STP with shares and warrants, but TD is so quick, it would be hard to tell the difference.

Emailed orders (combos) are usually fairly quick, but have had to wait a bit for them.  I wish Iress would make it possible to trade option combos online - would make it much easier.


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## long88

*Re: Best online Options Brokers for Aussie?*

Spectrum live are using TWS (same as IB), i have the account, but not yet funded it, i guess it would be the same as IB since it is on the same platform.

live data cost like $30/month, and there is minimum 1 trade/month for the acc to be no maintenance free.

i guess i just let you guys know later if i find out more.



boeingdriver said:


> Hi, first post just found this forum, very impressed so far.
> Try interactive brokers, the cost per trade on the Australian market is $3.00
> http://individuals.interactivebrokers.com/en/main.php
> I have not opened an account with them yet (you need $10000 ) usd or the equivilent in OZ dollars plus abt $34.00/month for a live data feed. At the moment I pay $45.00 a trade with Austock and $24 a month to weblink for their live feed so costs look pretty good. If you want to trade the US market its $1 usd a trade.
> I intend to open an account in the New Year and close my Austock account then.The only negative I have found so far is that they are not covered by the asx ? but are covered up to $30 million for stocks and $1 million for cash in your account see this link
> http://www.interactivebrokers.com/en/accounts/accountProtection.php?ib_entity=llc
> Hope this helps


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## investedz

*Re: Best online Options Brokers for Aussie?*

Hi guys,

I moved over to Comsec from OptionsXpress. Comsec gave me 2 separate accounts (within the same login). 1 for shares trading and the other for options trading.

For those joining Comsec, watch out for the following common newbie user problem:
When placing an options order, make sure that you have selected your options account (top right corner). I was a victim to this today and missed out on a trade (a good one too). I had placed the options order from my shares account, and the pending orders window was showing that I did not place any order!

Splitting the shares and options accounts may also mean you'd have to place separate orders for and share/options combination you may want to put on, such as covered calls, etc.

There's no ability to place combination orders for options (straddles, spreads, etc). At the moment it seems you would have to place combination trades manually, by buying the different parts of the trade individually. This would mean separate executions and fees for each leg, instead of the bulk execution/fee that Optionsxpress had for these types of trades.

Overall Comsec is not bad. So far my only complaint is usability, but I think today's frustration is a one off.


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## long88

*Re: Best online Options Brokers for Aussie?*



long88 said:


> Spectrum live are using TWS (same as IB), i have the account, but not yet funded it, i guess it would be the same as IB since it is on the same platform.
> 
> live data cost like $30/month, and there is minimum 1 trade/month for the acc to be no maintenance free.
> 
> i guess i just let you guys know later if i find out more.




just an update to this post for those of you who are interested.

i stay with spectrum live now, basically it is trader workstation, with $37.50 for australian data, and free for us live data (minimum trade is $30/us to be free).

brokerage is way more cheaper than etrade, a lot more flexibility than etrade.

the only problem is java, tws is very slow running on my pc, maybe it is time for new computer.

cheers


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## Beenjammin

*Re: Best online Options Brokers for Aussie?*



investedz said:


> Hi guys,
> There's no ability to place combination orders for options (straddles, spreads, etc). At the moment it seems you would have to place combination trades manually, by buying the different parts of the trade individually. This would mean separate executions and fees for each leg, instead of the bulk execution/fee that Optionsxpress had for these types of trades.




Very good point Investedz! Ive got a big issue at the moment along these lines.......

Im using Comsec to trade options too. The costs REALLY mount up quickly, and Im wondering if anyone knows of another method or broker who can let me do this more cost effectively _without_ having to expose myself to currency risk by going offshore:

Heres a very basic example writing a covered call:

1. Write 1 x $10.00 Calls on XXX at 50C: Cost: $35
2. Brokerage on $10,000 purchase of 1000 XXX shares: $20
4. Option Exercised on expiry at $10.00: 0.35% Allocation Brokerage Cost: $35

TOTAL Revenue $500
TOTAL Cost $90 (or *18%* of the revenue from the options sale)

You see how the costs would mount up, especially writing more complex strategies than a simple covered call. 

If the purchase of the equity comes out of a margin loan the costs get higher again, plus interest. Costs get marginally better on larger orders, but not much as once you get over a $25K Equity order Comsec goes onto 0.12% purchase brokerage.

So.....is there a more cost effective Australian based alternative (brokerage wise...I'm not interested in writing longer term or higher risk) or is this just another case of "we're in Australia, so we just have to take it"?

Thanks in advance!


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## storchyman

*Re: Best online Options Brokers for Aussie?*

I have found NAB online trading the best platform so far for ease of use and position clarity. But they do not do naked calls.

So use a commsec acccount aswell, not very impressed, mainly reasons already mentioned by other members and more, EG also missed out on highly profitable positions because of the stupid split account feature

I am going to give IB a go, and close the commsh it account


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## sails

*Re: Best online Options Brokers for Aussie?*

If you guys are planning to write options with IB, just make sure you know their rules on assignment.  Last time I checked, they give only a 10 minute window of opportunity after the market opens to deal with it unless you have sufficient funds or stock in the account before they start randomly unwinding positions in your account.

Just a heads up...


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## Beenjammin

*Re: Best online Options Brokers for Aussie?*

Just discovered a nasty Gotcha (well new for me anyway)...

If you write naked calls with Comsec, then down the track cover if the stock price rises through purchasing the stock, Comsec wont recognise the newly purchased stock to cover the options margin until it clears at T+3. Margin of course has to be settled daily.

This means at T+3 you need enough cash to cover the purchase of the stock PLUS covering the margin requirements. You get your margin cover back only after the stock has cleared.

Worse, if you happen to need to cover and you get allocated within 3 days, you need the cash to buy the stock AT CURRENT MARKET PRICE, PLUS BEING ABLE TO SETTLE FOR THE STOCK YOU BOUGHT EARLIER TO COVER, PLUS HAVING COMSEC HOLDING YOUR MARGIN. If the timing is just wrong then you can wind up needing a lot of cash and stock locked up "in processing" that is rightfully yours but you can't use as collateral against margin or a margin loan.  Nasty, and easy to get caught short.

Anyone use a broker who WILL give credit against share purchases that are locked up in the T+3 settlement period (assuming of course they have your cash sitting their to buy the stock?)

Cheers
B.


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## cutz

*Re: Best online Options Brokers for Aussie?*

Just give the options desk a ring,

BTW, what's your plan if the stock settles back down before expiry therefore not triggering an assignment.


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## Beenjammin

*Re: Best online Options Brokers for Aussie?*

Hi Cuts,

The options desk told me they might grant leniency once only if I did get stuck short on funds due to money tied up in margin etc, but once only. 
Its not likely to happen (although the warcry of the market has always been "**** happens!") but in case it does Id like to have an approved facility to get access to the neccessary cash for the one or two days involved. Maybe Ill have to arrange some kind of overdraw facility with the bank....

TO answer your question, I'd set a stop loss if the price eased back and then be prepared to buy in again if it whipsawed up once more.

Cheers
B


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## cutz

*Re: Best online Options Brokers for Aussie?*



Beenjammin said:


> Hi Cuts,
> 
> The options desk told me they might grant leniency once only if I did get stuck short on funds due to money tied up in margin etc, but once only.
> Its not likely to happen (although the warcry of the market has always been "**** happens!") but in case it does Id like to have an approved facility to get access to the neccessary cash for the one or two days involved. Maybe Ill have to arrange some kind of overdraw facility with the bank....
> 
> TO answer your question, I'd set a stop loss if the price eased back and then be prepared to buy in again if it whipsawed up once more.
> 
> Cheers
> B





G’Day

I’m trying to understand your situation. You’ve sold a couple of naked calls so I’m assuming you have provided a portfolio as collateral cover to satisfy the margin requirements, providing the market doesn’t move so fast that you run out of margin, trade plus T3 shouldn’t be a problem. If it’s causing a problem you are probably selling calls with inadequate margin. You can always hedge to reduce margin requirements.


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## Beenjammin

*Re: Best online Options Brokers for Aussie?*



cutz said:


> G’Day
> 
> I’m trying to understand your situation. You’ve sold a couple of naked calls so I’m assuming you have provided a portfolio as collateral cover to satisfy the margin requirements, providing the market doesn’t move so fast that you run out of margin, trade plus T3 shouldn’t be a problem. If it’s causing a problem you are probably selling calls with inadequate margin. You can always hedge to reduce margin requirements.




Hi Cutz,

First off I really appreciate your repeated feedback here - If by any chance we ever meet ITRW I owe you a couple of beers/wines/bourbons/whatever.

I dont have a portfolio at present, Im holding cash. I still believe the market has further down to go (present slight retracement notwithstanding) hence Im writing naked calls for income. 

I guess Im concerned, as you said, about being caught in a fast market and having cash tied up in margin when I need it to pay for stock. I just have to be super attentive to cash management.

CheerS!


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## long88

*Re: Best online Options Brokers for Aussie?*

hi benjamin, i hope you dont get caught on this sudden rising market. 



Beenjammin said:


> Hi Cutz,
> 
> First off I really appreciate your repeated feedback here - If by any chance we ever meet ITRW I owe you a couple of beers/wines/bourbons/whatever.
> 
> I dont have a portfolio at present, Im holding cash. I still believe the market has further down to go (present slight retracement notwithstanding) hence Im writing naked calls for income.
> 
> I guess Im concerned, as you said, about being caught in a fast market and having cash tied up in margin when I need it to pay for stock. I just have to be super attentive to cash management.
> 
> CheerS!


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## Beenjammin

*Re: Best online Options Brokers for Aussie?*



long88 said:


> hi benjamin, i hope you dont get caught on this sudden rising market.




Wont last long....bear market rally. It'll drop a lot faster than its risen. We'll see below 3000 before long....

Anyway, thanks for the concern. Didn't get caught out
(This time,anyway.)


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## cutz

*Re: Best online Options Brokers for Aussie?*

Be careful with that mindset Beenjammin,

Sorry about the clique but the market can remain irrational longer than you can remain solvent, with options it’s imperative that the trade is managed to suit the condition of the day.

A trip back to 3000 may happen but it's probably unlikely.


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## Beenjammin

*Re: Best online Options Brokers for Aussie?*



cutz said:


> Be careful with that mindset Beenjammin,
> 
> Sorry about the clique but the market can remain irrational longer than you can remain solvent, with options it’s imperative that the trade is managed to suit the condition of the day.
> 
> A trip back to 3000 may happen but it's probably unlikely.




Thank you, duly noted!

"Probably Unlikely" and I go way back..........


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## cutz

*Re: Best online Options Brokers for Aussie?*

BTW, an unlikely trip down memory lane could be interesting


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## malcolml

*Re: Best online Options Brokers for Aussie?*

Anyone know if Westpac Broking give you any gotchas?

I currently use Westpac Broking for options, as westpac can provide you with a risk graph for trades up to 4 legs.


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## Grinder

*Re: Best online Options Brokers for Aussie?*

Don't know about any gotchas but did meet a guy who is with them, said you can set up multi leg spreads online. Only problem was having to get authorisation from service desk everytime a spread was put on, said it took forever... other than that & the brokerage he had no complaints.

If your with them for the risk graphs, check out

http://www.samoasky.com/

does it all for FREE.


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## malcolml

*Re: Best online Options Brokers for Aussie?*



Grinder said:


> Don't know about any gotchas but did meet a guy who is with them, said you can set up multi leg spreads online. Only problem was having to get authorisation from service desk everytime a spread was put on, said it took forever... other than that & the brokerage he had no complaints.



Yeah that's true, i called westpac broking once and they told me if you don't have a Westpac Cash Manager account, the only way to trade options with westpac is by phone, i called them before and they said they charge the same rate as online trading.
(accounts from all other banks and westpac saving/daily account are not accepted by westpac for options)


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## sails

*Re: Best online Options Brokers for Aussie?*

Malcolm, another free one is from this site: http://www.hoadley.net/options/strategymodel.htm

I think you can get up to four legs working on the basic, free version.  It also has a comparison feature where it will overlay two different strategies which is something I used extensively.


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## long88

*Re: Best online Options Brokers for Aussie?*

hi malcolml,

just some feedback for you here.

i am with spectrum live, as i have noted before in the beginning of the thread.

i have use them about 5 month now, not too bad, actually quite happy with it, apart from not getting used to web based (etrade) to java based program (which is real time), and closing the trade using leg in,  (which costing me a lot of money + a bit of whip saw on the market, got shaken out), but now learning from it, and got better.

you need to pay $35/month for live data (aussie), and for us, at least you trade twice a month, you will get free live data.

They are actually Interactive broker (for options, as i am using their program, and can log in to web based if i want to, plus can run it on my mobile as well).

For the CFD, currency, Stock, commodities, it is using another program, but got all the tools needed (except acceleration band).


With naked put, it is all cash secured, and all accounts are on margin, so all i have is cash, and when i need to open a naked position, cash will be locked up according to the position required until i close that position.

with assignment, i just assigned on my short leg (HBC) and it is using up 80% my margin (approx 11k USD), on a 8k AUD account, lucky i got my long leg to cover me (never go naked guys), and i am short that position for about 3 days, and market kept going up.

all i have to do there is exercise my long leg (cost me $40 USD), and i lock in my max lost for the trade, got me out of that trouble, and release all of my cash again (margin is taken because i am short hbc, and market kept going against me).

so basically one sign up, got everything you need, work out your profitable trading system (be it moving average, stockastic, macd, etc), then trade.

One thing here (my 2 cents). market have been going up for about 4 weeks now, it seems to have found the bottom, couple of retest last week, and it has snapped up (cost me some $$$ on naked long put). 

Trade well.

Cheers 




malcolml said:


> Yeah that's true, i called westpac broking once and they told me if you don't have a Westpac Cash Manager account, the only way to trade options with westpac is by phone, i called them before and they said they charge the same rate as online trading.
> (accounts from all other banks and westpac saving/daily account are not accepted by westpac for options)


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## Fox

*Re: Best online Options Brokers for Aussie?*



sails said:


> With TD, once they have the order set up, they give me the code for that particular combo (only good for the day) and then I am able to amend, delete, re-order as I would any single option order.  I really like that bit.  Sometimes you can see other orders, and sometimes the MM brings a counter bid or offer which is very helpful.
> 
> ...
> 
> I don't think you can see the market depth window for spreads with IB so you wouldn't know if a MM put in a counter bid/ask, however, you can amend, etc quite easily.



I would like to be able to view the market depth for spreads. As per Sails' comments, IB does not provide that info. Does anyone know how I can get the market depth info? Thanks.


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## sails

*Re: Best online Options Brokers for Aussie?*



Fox said:


> I would like to be able to view the market depth for spreads. As per Sails' comments, IB does not provide that info. Does anyone know how I can get the market depth info? Thanks.




Fox, if you are wanting it for the Oz market, I've probably changed my ideas a bit and feel now that it's debatable if it's worth it.  I found it was very rare to find anyone else in the MD window for a specific spread - even on BHP.  Sometimes the MMs will quote the other side at an unwanted price, but sometimes it was just my order on it's lonesome. Many times, I would cancel out of the spread and then leg the order instead - often getting a better price. 

It just makes you feel like a very little mouse being toyed with by a bunch of over-fed cats.  I used to have some respect for the ability of MMs in general, but have no tolerance for the apparent rip-offs.  Sorry - end of vent. 

It is possible that any broker using WebIress would have the same ability to give the customer the relevant ASX code for that unique spread for the current day so that it can be viewed in MD.  Perhaps the other brokers could do it too using their MD windows, but choose not to - who knows in the Oz market.


----------



## Fox

*Re: Best online Options Brokers for Aussie?*



sails said:


> Many times, I would cancel out of the spread and then leg the order instead - often getting a better price.



Wow! Legging a 4 leg spread can be a challenge with prices bouncing about! I admire how you guys manage it.

I have just been yielding to the MMs by giving them above what I think is mid-price or fair value. Otherwise, I never get a fill.

So it looks like IRESS is the way to go as far as MD is concerned. That's a bummer because I'm using IB. Why is options trading so hard? But I still keep coming back for more. 

Thanks, Sails.


----------



## sails

*Re: Best online Options Brokers for Aussie?*



Fox said:


> Wow! Legging a 4 leg spread can be a challenge with prices bouncing about! I admire how you guys manage it.




Fox, I was referring more to 2 legs - often adjustments. 3+ legs I would hang in there - obviously a lot more to lose in slippage.



> So it looks like IRESS is the way to go as far as MD is concerned. That's a bummer because I'm using IB. Why is options trading so hard? But I still keep coming back for more.




I found it was useful to have Iress in addition to IB. I felt I would lose less in slippage with access the full market depth on each individual option (not just the spread).  It's easier to see what's really going on.  The "detail" button on the Iress MD window is very handy and I found it useful in sorting out approximate fair prices for my spreads.  Whether or not you can get anywhere near that fair price is quite another story!


----------



## Fox

*Re: Best online Options Brokers for Aussie?*

Hi Sails,



sails said:


> I found it was useful to have Iress in addition to IB.



The only IRESS I know of is the one provided by CommSec. If I recall correctly, you will need to place about 8 trades a month in order to pay for the service. Unfortunately, my trade sizes are still too small to justify using CommSec for now.

Another question if I may. If you place a spread order (eg. a vertical) in IB, how do you view the MD of that order using IRESS? My understanding is that you will need the unique code identifying the spread order to enable you to search and view the MD. How do you get that unique code from IB? Or does IB even provide it?

Thanks,
Fox.


----------



## sails

*Re: Best online Options Brokers for Aussie?*



Fox said:


> Hi Sails,
> 
> 
> The only IRESS I know of is the one provided by CommSec. If I recall correctly, you will need to place about 8 trades a month in order to pay for the service. Unfortunately, my trade sizes are still too small to justify using CommSec for now.




Fox, I use Trader Dealer's Iress and you have to generate 20 contract notes during the month to get it "free" - at least that's how it used to be. If you do about 12 contract notes, you don't pay full fees, but it's still another thing eating up trading profits.  TD have quite a good system where you can trade quite a bit throughout the day and, within certain criteria, only generate one contract note for the day for that particular stock, warrant or option.  It gives the opportunity to scale a bit through the day without running up min. fees each time.  This can be a huge saving in fees and I have to say that TD's fees are pretty good if trading some size.  However, that doesn't deal with the much bigger issues of slippage and the relentless ASX fees per contract - plus software costs including the ASX data royalties.

I haven't used Commsec Iress, however, I am led to believe that Commsec have tailored it to their own requirements and not all the Iress features are available.



> Another question if I may. If you place a spread order (eg. a vertical) in IB, how do you view the MD of that order using IRESS? My understanding is that you will need the unique code identifying the spread order to enable you to search and view the MD. How do you get that unique code from IB? Or does IB even provide it?




Any single order you place with IB should show up in the Iress MD.  If you are trading a multi-legged spread, each individual leg of that spread sometimes shows up in it's relevent MD window.  Sometimes you might only see one of the legs show up in MD.  I queried this once with a broker and was told that sometimes the MM puts one side into the open market and sits on the other side/s of the spread.  Obviously the one in the open market is the worst possible price - maybe in the hope we will keep moving the price to get that one leg closer to the action and then the MM can make more from the other side.  Who knows what they do, but it's obviously how to get the most cream for themselves.

I had one order some time ago (with TD) where not one of the legs of the spread were visible in their individual MD windows.  I queried this and was told the MM had decided not to show the order.   So, it appears my spread was entirely at the mercy of one MM - and that was on BHP where there are supposedly multiple MMs and more retail liquidity that most other Oz options.  This was pretty much the final frustration for me, leading me to quit any serious option trading in the Oz market.

That was one order I promptly cancelled and then legged at a much better price.  It was a closing order on expiry day where the spread was in profit and I wanted to lock that profit in - so it was a deal that had to be done.  Because I had Iress and all MD windows open for each  option in that spread, I could see the activity and clearly showed there was plenty of liquidity to leg the deal - was all executed in seconds!


----------



## Fox

*Re: Best online Options Brokers for Aussie?*

Hi Sails,

Thanks for putting so much effort in your reply. Your fingers must have had enough exercise for today .



sails said:


> TD have quite a good system where you can trade quite a bit throughout the day and, within certain criteria, only generate one contract note for the day for that particular stock, warrant or option.  It gives the opportunity to scale a bit through the day without running up min. fees each time.  This can be a huge saving in fees and I have to say that TD's fees are pretty good if trading some size.



I will need to check TD out. Never heard of them before. Sounds promising.



sails said:


> Any single order you place with IB should show up in the Iress MD.  If you are trading a multi-legged spread, each individual leg of that spread sometimes shows up in it's relevent MD window.



I think I must have misunderstood the nature of the MD of a spread order. I had the impression that the spread order itself (and not the individual legs) was placed in queue and the MD showed the spread orders in the queue. For example, if I placed a buy order for a bull call spread for $1 and you placed a buy order for the same bull call spread for $0.90, then your bull call order will be placed ahead of mine in the MD screen. The MD will consists of a queue of bull call spreads.

The queue would look something like this:



		Code:
	

ASX Code: BC001 
   
           bid    ask 
Sails --> 0.95   1.50 <-- Fat cat MM
Fox   --> 1.00   1.60 <-- Fat cat MM's desert[/FONT]


I did not realise that you were talking about MD of the *individual *legs. 



sails said:


> Because I had Iress and all MD windows open for each  option in that spread, I could see the activity and clearly showed there was plenty of liquidity to leg the deal - was all executed in seconds!



Ah! That's how you do it in so quickly.


----------



## sails

*Re: Best online Options Brokers for Aussie?*



Fox said:


> Hi Sails,
> 
> Thanks for putting so much effort in your reply. Your fingers must have had enough exercise for today .




No worries - babysitting a couple of sick grandkids here today - so it's nice to escape when I can - lol.  So, the posts are being typed in bits and pieces - hope they're not to disjointed!




> I will need to check TD out. Never heard of them before. Sounds promising.




One of the things I really liked is that one of the brokers usually answer the phone very quickly - have never been put on hold or select from a menu, etc.

However, I believe they don't allow credit spreads which Grinder found out.  I like butterflies, calendars, etc (all of which can be easily morphed!) and also trade the occasional debit spread close to expiry if the conditions look good - so I didn't have that problem with them.  Even though the butterfly has an embedded credit spread in it, they must have been OK with that because the position itself was placed as a debit.  Not unless they give some leniency for long term customers.




> I think I must have misunderstood the nature of the MD of a spread order. I had the impression that the spread order itself (and not the individual legs) was placed in queue and the MD showed the spread orders in the queue. For example, if I placed a buy order for a bull call spread for $1 and you placed a buy order for the same bull call spread for $0.90, then your bull call order will be placed ahead of mine in the MD screen. The MD will consists of a queue of bull call spreads.
> 
> The queue would look something like this:
> 
> 
> 
> Code:
> 
> 
> ASX Code: BC001
> 
> bid    ask
> Sails --> 0.95   1.50 <-- Fat cat MM
> Fox   --> [B]0.90[/B]   1.60 <-- Fat cat MM's desert
> [B]MM   -->  0.60[/B][/FONT]
> 
> 
> I did not realise that you were talking about MD of the *individual *legs.




I have altered your MD a little and put my changes in bold.  In this example, the mid price of first (Fat cat MM) and the MM bidding would be 1.05 ((1.50 + 0.60)/2), so I would expect to pay a little above that if I want immediate execution - and that is usually what I do.  If the market is going down, I wouldn't show my hand earlier as I have seen, time and time again, they just let your order sit there (say at 95c in your example) until that price matches their offer.  I wait until I think we are close to a turning point and then go straight in with a cent or two in their favour.  If I'm initiating an order and they play funny games, I simply cancel.  If it's a closing order, then I will look at what else can be done - that's where understanding synthetics can help in finding another solution than just executing that trade.

But, I don't think I have explained it well enough.  With Iress, I use both spread MD and individual option MD for each leg of the spread. Eg if it's a bull call spread, I would have Spread MD open plus the two individual option windows open.  That way I continually monitor any activity in those two individual options to help with decisions on whether to adjust my price or, as in the example in my last post, use any flurry of activity to leg at a better price.  Because it is so boring just watching your order all alone in the spread MD, I believe it is necessary to monitor the individual legs as well.

What you describe above in your spread MD example is what I would like to see, but sadly, it's was more often than not just my order sitting alone in the spread MD.  LOL -  it would be quite a buzz to see a MM come in on the other side with my exact size - not that I was happy with their price, but just nice to see a slight hint of action after sitting watching grass grow for far too long. 



> Ah! That's how you do it in so quickly.



That example I gave you was done on expiry day on BHP and the options were close to the money - meaning that's were the most activity was happening anyway.  So, in that case, all legs of the spread were executed very quickly.  Don't forget, I had all MD windows open, had been observing for a while, so it was pretty simple to do the deals.  There were heaps of other retail orders all wanting to get their deals done, so the speed was a bit specific to the activity one can find on expiry day.


----------



## Fox

*Re: Best online Options Brokers for Aussie?*



Fox said:


> ... you will need the unique code identifying the spread order to enable you to search and view the MD. How do you get that unique code from IB? Or does IB even provide it?



Wasn't thinking laterally. I shall answer my own question for the benefit of those as dense as me . I should just create another order in IRESS with the identical spread and get the unique spread code from there. Simple! Duh! 



sails said:


> No worries - babysitting a couple of sick grandkids here today - so it's nice to escape when I can - lol.



Hope they get well soon. You're a fantastic grandad. When my kids get sick, I don't have the luxury of grandad's assistance.



sails said:


> However, I believe they don't allow credit spreads which Grinder found out.  I like butterflies, calendars, etc (all of which can be easily morphed!) and also trade the occasional debit spread close to expiry if the conditions look good - so I didn't have that problem with them.  Even though the butterfly has an embedded credit spread in it, they must have been OK with that because the position itself was placed as a debit.  Not unless they give some leniency for long term customers.



I had a look at TD's website. Fee wise, they are ahead of the Oz brokers I'm familiar with. The ability to put all trades in one contract note is a good compromise for both trader and broker. If IB exits the Oz scene, I will definitely sign up with TD.



sails said:


> ... so I would expect to pay a little above that if I want immediate execution - and that is usually what I do.  If the market is going down, I wouldn't show my hand earlier as I have seen, time and time again, they just let your order sit there (say at 95c in your example) until that price matches their offer.  I wait until I think we are close to a turning point and then go straight in with a cent or two in their favour.  If I'm initiating an order and they play funny games, I simply cancel.  If it's a closing order, then I will look at what else can be done - that's where understanding synthetics can help in finding another solution than just executing that trade.



You have taken order filling to an art form. I'm exhausted just thinking of the mind games with the MM. I feel like an innocent lamb in a slaughterhouse with my lone bid in the queue. My orders must be the butt of MM jokes during their lunch hour conversations.


----------



## mazzatelli

*Re: Best online Options Brokers for Aussie?*



Fox said:


> Hope they get well soon. You're a fantastic grandad. When my kids get sick, I don't have the luxury of grandad's assistance.




You're the best M!! 
PS: Fox It's grandmum, although I am sure she covers for grandad too :


----------



## Grinder

*Re: Best online Options Brokers for Aussie?*



Fox said:


> You have taken order filling to an art form. I'm exhausted just thinking of the mind games with the MM. I feel like an innocent lamb in a slaughterhouse with my lone bid in the queue. My orders must be the butt of MM jokes during their lunch hour conversations.




she sure has. As if options trading is'nt challenging enough, one has to endure the head games as well....  so glad I gave Oz ops the flick, no need to worry about all that nonsense


----------



## Fox

*Re: Best online Options Brokers for Aussie?*



mazzatelli said:


> Fox It's grandmum, although I am sure she covers for grandad too :



 A thousand apologies, Sails. I've shown myself to be an MCP. Before I embarass myself any further, please correct my following gender assumptions:

Cutz - Male
Mazza - Definitely male (from your avatar preferences)
Grinder - Male
WayneL - Male (unless your videos were dubbed with a male voice)
Fox - The last time I checked, it was still male


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## sails

Fox said:


> ..You have taken order filling to an art form. I'm exhausted just thinking of the mind games with the MM. I feel like an innocent lamb in a slaughterhouse with my lone bid in the queue. My orders must be the butt of MM jokes during their lunch hour conversations.




Fox, dunno about the art form bit - necessity is the mother of invention.  I'm sure the MMs have derived much amusement from my orders too.  But not for long - it's fill it or it's gone... lol



mazzatelli said:


> You're the best M!!
> PS: Fox It's grandmum, although I am sure she covers for grandad too :




shhhh Mazza - didn't you know options are gender neutral? I can only imagine what I've started now...
Anyway, Cottle never mentioned it was a problem... lol



Grinder said:


> she sure has. As if options trading is'nt challenging enough, one has to endure the head games as well....  so glad I gave Oz ops the flick, no need to worry about all that nonsense.




Yeah, the short stint I did with US options was sheer heaven.  They actually want to fill your orders there.  The mind games here get quite tiring when they go on for too long and I pretty much shudder at the thought of option trading here in Oz.  When I get my life back again, US options it will be, but until then I am looking mostly index trades (a little of XJO options, SPI and some STW for the super fund).  



Fox said:


> A thousand apologies, Sails. I've shown myself to be an MCP. Before I embarass myself any further, please correct my following gender assumptions:
> 
> Cutz - Male
> Mazza - Definitely male (from your avatar preferences)
> Grinder - Male
> WayneL - Male (unless your videos were dubbed with a male voice)
> Fox - The last time I checked, it was still male




lol Fox - no apology necessary and I didn't make it clear anyway.  Now you know where the long posts come from...    When it comes to options, theory, experience, etc are all far more important...


----------



## mazzatelli

LOL
For the record I have nothing against female traders. The more ladies, the better I say  . As you know M, I love your stuff!!!

PS: Fox, WayneL is female and that is her natural voice  : *ducks for cover* 

So:
Females: sails, WayneL and Fox[y Lady]
Males: cutz, Grinder, mazza


----------



## Fox

mazzatelli said:


> Females: sails, WayneL and Fox[y Lady]
> Males: cutz, Grinder, mazza



LOL. I think Mazza has morphed/adjusted options trading from being gender *neutral* to gender *confused*.  One wonders how this thread has degenerated from "Best online options brokers for Australia?" to this .


----------



## sails

Fox said:


> LOL. I think Mazza has morphed/adjusted options trading from being gender *neutral* to gender *confused*.  One wonders how this thread has degenerated from "Best online options brokers for Australia?" to this .




Sorry - I think I started the morphing degeneration ... 
But then life can't be all serious - gotta have some fun too...


----------



## wayneL

I'm one of those girls that likes girls.


----------



## cutz

sails said:


> a little of XJO options, SPI and some STW for the super fund




Hi Sails,

Are you using SPI futures in conjunction with XJO options ?


----------



## sails

cutz said:


> Hi Sails,
> 
> Are you using SPI futures in conjunction with XJO options ?




Not live trading at the moment, but looking at ideas for when I have the time to trade live again.  I not sure how liquid SPI options are, so yes, XJO options are a possibility.  

I have an XJO multi-legged thingy on the IB demo- started off as a butterfly and has had a few adjustments along the way and now resembling two short flies.  lol - demo is worse than real life - the demo doesn't seem to execute spread trades, so they have to be legged in and will only execute if buying at the offer and selling at the bid!  Still it's better than getting rusty and doesn't matter and then not risking real $ if I'm not around when the next adjustment needs to happen.

Spi futures is how I started trading with Safety In The Market about 11-12 years ago.  I struggled with it back then and so been toying around with a bit of scalping to see if I can do any better at it - again on the demo due to too many interruptions to risk real $.


----------



## cutz

Gotcha Sails,

I'm using SPI futures with XJO options at the moment but i don't think the two are cross margined.

I have a love/hate relationship with XJO options, normally they're good, today they were bad, (got a toasting on slippage).

I guess in times of low IVs slippage really becomes a matter of profit or loss, something i've finally come to the realization.


----------



## Grinder

cutz said:


> Gotcha Sails,
> 
> I'm using SPI futures with XJO options at the moment but i don't think the two are cross margined.
> 
> I have a love/hate relationship with XJO options, normally they're good, today they were bad, (got a toasting on slippage).
> 
> I guess in times of low IVs slippage really becomes a matter of profit or loss, something i've finally come to the realization.




Had many simmilar experiences with XJO, even if the market was in your favour and your timming was spot on it still did'nt help. Not fun giving the other side a 5 goal head start before the ball has even been bounced, not much you can do about it though.


----------



## sails

cutz said:


> Gotcha Sails,
> 
> I'm using SPI futures with XJO options at the moment but i don't think the two are cross margined.
> 
> I have a love/hate relationship with XJO options, normally they're good, today they were bad, (got a toasting on slippage).
> 
> I guess in times of low IVs slippage really becomes a matter of profit or loss, something i've finally come to the realization.




Cutz, to the best my knowledge, I agree that there is no cross margining between XJO options and SPI futures.  SPI options periodically have some pretty good volumes, but other times there is so little activity.  Definitely more consistent turnover in XJO options.

The other thing to take into account is the fact that XJO options are based on a $10 contract size and yet it's $25 contract size for the SPI.  So one would need to adjust the quantities as necessary.  On the ASX site, I see there are also XJO futures with $10 contract size, but I suspect liquidity is pathetic.  

I believe that the XJO option MMs use the SPI to hedge - so I wonder why the ASX don't have just one set of futures and one set of index options with the same contract size.  Hmmmm perhaps there is more money in it for them the way it is...


----------



## cutz

Yeah Sails,

It's really annoying having the 2 different sizes on the XJO options and SPI futures, inputting one SPI contract into Hoadleys i need to tell it it's 2.5 futures contracts so it's pretty cumbersome.

A matched set of highly liquid aussie futures and options contracts something like Estoxx over in Europe would be nice, the current system resembles a dogs breakfast.

I propose ditching all the silly non liquid derivatives kicking around and matching the XJO options to the SPI contracts.


----------

