3 ms·
What's stopping him from doing a similar thing by selling deep OOTM options off of money he borrows on his margin account at any other broker?
by chillacy 10y ago
What's stopping him from doing a similar thing by selling deep OOTM options off of money he borrows on his margin account at any other broker?
- vostok 10y agoDeep out of the money options have optionality whereas BitMex contracts are delta 1 products. They have literally nothing in common. The relevant difference in this case is that the option caps your upside.
- chillacy 10y agoMy point is that risky financial plays are still possible even in the SEC regulated market. Maybe I misunderstood the parent poster though.
- zeusk 10y agoAs per SEC requirements, brokers are required to quiz you to makes sure you understand the risks involved in trading derivatives. Furthermore, selling naked options (Level 3 access) without hedging or verticals requires certain capital and margin requirements, I do not think it is easily possible to get 50x levered in options alone - you'd probably need /ES futures for that.