Azov

I indirectly answered my own question. I called TD/TOS yesterday to request a lower commission rate on my options trading. They granted my request today (no ticket fee and $0.75 per contract), and they also (unasked) lowered my exercise/assignment fee from $19.95 to $8. I realize that $8 is still higher than the $0 I could get at IB, or even the $5 at TW, but this is probably JUST low enough to make it feasible to do wheel trades with TOS. Edit: they also lowered my equities commission to $4.95 (also unasked).

Very glad to hear the procedure went well! Best wishes for a speedy recovery to your wife, and happy (US) Thanksgiving to you both and everyone in the SO community!

I have heard (admittedly, secondhand) that Robinhood has a similar auto-liquidation algorithm to IB that has also blown up people’s accounts. It makes me very nervous to trade with a broker that will indiscriminately liquidate positions without regard to whether it solves the problem that created the margin call in the first place! If that’s not the case with RH, I would welcome a correction from anyone with firsthand experience. TOS may have overpriced commissions, but they have always been extremely easy to work with when I’ve been assigned on positions. It’s just that I can’t pay $40 round trip in assignment fees to do these wheel trades and still be profitable long-term.

Plus keep in mind that it’s not at all uncommon for FB to move $10 or $20 in a day - often to the downside. Naked puts at $120 (especially at the size you’re talking about) could quickly turn into a disaster.

Just wondering if anyone has ever had success negotiating with TOS to reduce/remove the $19.95 fee that TOS charges for assignment and exercise. If so, what kind of arguments worked best? I agree with Kim that we shouldn’t have to negotiate to get the best rates. However, I greatly prefer TOS’s platform to anything else out there. I’ve been using tastyworks for a while now too, and their platform is only ok, but it’s still a work in progress, and they still charge $5 for assignment/exercise. The reason I’m asking - and not considering IB’s $0 assignments- is because I’m evaluating a couple of candidates for wheel trades (sell puts, get assigned, sell covered calls, get assigned, rinse/repeat). Since the cycle involves two assignments, the $40-ish total fees at TOS is cost prohibitive. And I refuse to use IB because of their auto-liquidation algorithm - I don’t want to have my account blown up if I get assigned on a couple of different positions one night and don’t have a chance to close things out within 10 minutes of the market opening. So if I could get TOS to come down or eliminate their assignment fee, that would be great. Otherwise I’m stuck with TW - I suppose I’ll get more used to their platform over time, but everything about their apps makes me feel like I’m playing an arcade game from the 80s. And not in a good way.... Any input is greatly appreciated!

Good luck! I’m still considering getting into this, but have a lot of irons in the fire these next couple of weeks. I’ll let you know if I take the plunge.

This is an interesting idea, but if I were going to do it, I’d be tempted to use an ETF like FXI instead of BABA or BIDU. It has much more liquidity than either of those two names (in terms of open interest and bid-ask spread), and its straddle price is a much lower percentage of the stock price, so it’s easier to get into with a smaller account. Granted, the absolute dollar moves are likely to much less, but the percentage move could be higher. It’s currently at a higher IV rank at the moment, which is something to keep in mind, but I think the other factors (especially liquidity) would make this a better choice for personally. Just a thought.

It’s also important to remember that the holder that exercised the call is almost certainly not the person who originally bought the call from you. The OCC “randomly” assigns short options for assingment/exercise, so you have no way of knowing what the breakeven was for the person who actually exercised the call. It’s possible that they bought the call on a downtick, in which case the $105 strike was profitable for them at expiration. And even the person you sold it to might have exercised to recapture ~$7 of the premium they paid. The bottom line is that if an option you sold is going to expire in the money, it’s very unlikely you’ll collect 100% of the premium you sold (absent an unlikely and risky series of market moves in your favor). As Jules said, the best course of action in the future is to close out the position before expiration and lock in a nice profit. Make sure you call your broker first thing on Monday. Hope all goes well in the morning!

Well, it’s not much, but I was able to make a decent profit selling put credit spreads on TLRY. On Monday, I sold the 12 Oct 140/135 put spread for $4.41 and just bought it back for $3.25 (23% profit on $5 spread). I also sold the 21 Sep 120/115 put spread for $3.20 and bought it back yesterday for $1.45 (35% profit). Give the volatility of the stock, I don’t think I’ll try this again, but wanted to report a slightly positive outcome. Many condolences and thanks to @clipsnation183 for suffering through a literal cautionary tale to help make us all better traders.

That’s terrifying - so sorry you’re going through this! I decided to try a couple of bull put spreads in near-terms expirations to dip my toe in the water. The assignment risk on calls is more than my nerves could take.

TOS is apparently having none of this any more. I can’t even get an order in for one iron fly. It keeps rejecting orders and telling me to contact the margin desk (even though account margin isn’t an issue). I really don’t feel like talking this through with one of their margin people, so I guess I’ll watch from the sidelines as well. Good luck to everyone in the trade!

I think there will be a lot of us looking to see if it does!

I tried many combinations, but couldn’t get a fill above $2 for a $2 spread IB on TOS. Even though at one point the mid was showing $3.60! Time to change brokers, I think.