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Fidelity Capital Req's

Discussion in 'General Discussion' started by Bill Lasko, Mar 30, 2017.

  1. Bill Lasko

    Bill Lasko New Member

    I'm brand new to this great service ( thank you ) and found that with my first BWB on Fidelity - the capital they hold back is $25K for a trade that can't possibly lose more than $9,800

    I phoned the active trader desk and they didn't state that the issue could be fixed - they were cordial but I suppose I'll be transferring the remainders of my funds out of their accounts and over to TOS or IB.
     
  2. Tim

    Tim Well-Known Member

    Hi Bill. Yes, different brokers margin BWB's differently under reg T margin rules. TOS is great and has the lowest margin, likely the $9800 you see on the graph. Schwab is like fidelity and will margin the same trade 3x higher, which it sounds like Fidelity does too. They won't "fix" it. If you have PM it will be much less, in line with what the maximum possible loss is on the graph.
     
  3. Jack

    Jack Well-Known Member

    [QUOTE="I phoned the active trader desk and they didn't state that the issue could be fixed - they were cordial but I suppose I'll be transferring the remainders of my funds out of their accounts and over to TOS or IB.[/QUOTE]

    Best decision to transfer to TOS. Things are a lot more straightforward for our types of trades. I had to transfer all my funds from another broker a few months ago. Trading is difficult enough, no need to spend extra energy on margin, platform, commissions and other issues!
     
  4. Mark Mosley

    Mark Mosley Member

    I had the same problem with Fidelity making it prohibitive to trade broken wing butterflies. They split the trade into its bearish and bullish components, and treat it as if you could hit Max loss in both directions, an impossible scenario. I called and complained a number of times, and they really had no idea what I was talking about. The only answer is to move your accounts to an options friendly broker.:(
     
  5. Patrick Yahoon

    Patrick Yahoon New Member

    Fidelity knows the problem with the margin. When you complain, they either claim ignorance, or try to explain it away. They have also started a "phantom call" signal, which is not only a false margin call, but ends up interfering with the ability to transfer cash or trade. Their response is that the client can always phone Fidelity for assistance. Schwab does the same on the margin requirements, except they add that Schwab will introduce a margin portfolio account this coming November. They started saying that two years ago, and maybe someday November will finally arrive.
     
  6. Mark Mosley

    Mark Mosley Member

    Fidelity prefers customers who buy and hold mutual funds. They want nothing to do with options traders. Nobody at Fidelity even understands a broken wing butterfly. And their Active Trader software is crap.
     

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