Good broker sought

This is a discussion on Good broker sought within the Brokerages forums, part of the Commercial category; I'm looking to utilise buy/write strategies (long stock, short call) on UK equities. Could someone suggest a decent broker (and ...

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Old Aug 11, 2007, 11:24am   #1
Joined Jun 2006
Good broker sought

I'm looking to utilise buy/write strategies (long stock, short call) on UK equities. Could someone suggest a decent broker (and comm's). Execution-only. I'm in the UK.

Thank you.

Grant.
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Old Aug 11, 2007, 5:34pm   #2
 
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Interactive Brokers seem to have a wide range of order types for options within a gbp account. Because it's execution only you will need to keep a tight watch on margins, they don't issue margin calls, just close you out according to a pre arranged formula until margin is back in line.
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Old Aug 11, 2007, 6:50pm   #3
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grantx started this thread Peto,

Thank you for the info.

Grant.
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Old Aug 15, 2007, 11:43am   #4
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Originally Posted by grantx View Post
I'm looking to utilise buy/write strategies (long stock, short call) on UK equities. Could someone suggest a decent broker (and comm's). Execution-only. I'm in the UK.

Thank you.

Grant.
Hi Grant,

Berkeley Futures Ltd, I company that i work for, allow you to write options on a covered basis on UK stock. You get a haircut value against the stock depending on the quality of the stock that you lodge as collateral. This means that you can lodge vodaphone stock and write BT options against that position or indeed lodge vodaphone stock and write vodphone calls or puts aginst that position.

The haircut value is dependent on whether a stock is SETS 1 or SETS 2 as determined by the LSE and you get a 35% haircut on SETS 1 stocks and 50% haircut on SETS 2 stocks.

Berkeley Futures do not operate a policy on UK covered option writing of not meeting a margin call unless the account becomes a commercial risk.

If you would like any futher info then please ley me know.
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Old Aug 15, 2007, 6:03pm   #5
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So, Berkeley Futures Ltd does not use SPAN for margin calculations? IB will beat it.
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Old Aug 15, 2007, 6:10pm   #6
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So, Berkeley Futures Ltd does not use SPAN for margin calculations? IB will beat it.
Thats not actually what i said. Berkeley Futures does use SPAN to calculate the appropriate margin rqeuirement. I was saying that instead of lodging funds as collateral to meet that span margin requirement you can lodge various types of collateral. For example Gilts, Bullion are other acceptable types of collateral that you can lodge with the claering house. Berkeley Futures will accept all types of collateral that the clearing house accepts and on top of that they will also accept SETS one and SETS 2 stocks to be set against span initial margin requirements.

I wouldn't be able to comment on whether IB allow you to lodge stock as collateral
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Old Aug 15, 2007, 6:54pm   #7
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grantx started this thread BF,

Thank you for the info.

I think I should clarify: I would be looking to buy stock and sell options via the same broker. Can I also buy stock via Berkeley?

Re collateral. In this context I think there is a distinction between 'covered' (by acceptable collateral, and subject to a haircut)and 'buy-write', ie the short in the latter is covered by the underlying thus, no risk and no margin.

Grant.

Last edited by grantx; Aug 15, 2007 at 7:01pm.
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