20 ms·

Can someone advise what's the best way to buy derivatives (etrade,scottstrade, etc): the fastest way to open an account, the best order execution times? I want

by cft 13y ago

Can someone advise what's the best way to buy derivatives (etrade,scottstrade, etc): the fastest way to open an account, the best order execution times? I want to invest some money to short this.

joshmlewis 13y ago
I was wondering this as well. Trading stocks always seem a little out of reach for some reason.
adventured 13y ago
If you didn't catch a short on it near $50, wait. The stock market bubble is going higher under Yellen's dove policy. The valuation crazy tech stocks like TWTR or LNKD will go that much higher accordingly. This market doesn't drop until the Fed stops or the market goes so high it is forced to crash (runs out of oxygen, everybody panics, mass selling ensues, down goes the latest bubble).
RyanZAG 13y ago
There's a lot of paperwork and checks involved. No matter what route you go, it will take some time.
MichaelApproved 13y ago
Please don't take this as snark but I wouldn't recommend shorting anything if you are so inexperienced that you don't have a trading account or don't know which one to use. Shorting stocks is extremely risky and should only be done by traders with lots of experience. If you really want to bank on Twitter going south, you can try buying puts when they're available. If you're not sure what puts are, leave this whole idea alone.
- cft 13y ago
  i run a bootstrapped company that i founded in 2006, and i have some extra money i am totally comfortable of losing entirely. i view this as an experiment. i am looking for a serious practical advice.
  - MichaelApproved 13y ago
    I would still recommend against it but you should know that shorting isn't always available right after a stock IPOs. It can take about a month before its possible. Its been a while since I've dealt with IPOs so I'm not 100% sure if that's the case anymore. If you want to get involved, call TD Ameritrade. They can give you 100% accurate information and get you setup quickly.
  - derwiki 13y ago
    But that's exactly the danger with shorting, your losses aren't capped by what you put in. A stock can only drop to 0, but it can go up to whatever -- you have no upper bound on losses. Do whatever you want, but know what you're doing. http://www.investopedia.com/university/shortselling/shortselling3.asp http://www.investopedia.com/university/shortselling/shortsel...
  - grmarcil 13y ago
    Consider this carefully: "When you are a long a stock, the most you can lose is the amount you paid. When you are short, you can lose unlimited money." If you have "funny money" that you aren't afraid to lose, there are safer and more responsible ways to experiment with the market than unprotected short positions. You may want to read about and understand some options strategies: http://www.investopedia.com/terms/b/bearputspread.asp http://www.investopedia.com/terms/b/bearputspread.asp http://www.investopedia.com/terms/b/bearcallspread.asp http://www.investopedia.com/terms/b/bearcallspread.asp Either one of those strategies gives you the opportunity to profit a certain amount if the stock actually goes down (the width of the spread times the quantity), while limiting your exposure to just the premium you pay for the options. Your exposure is limited because you both buy and sell puts or calls for equal amounts of the underlying, so you have no net exposure to the price of the underlying. A general word of advice about playing the market for short term gain: big guys make money off of little guys. You may win some, but usually you are doing damn well as a small time trader if you're batting above 500 at all.
    - MichaelGG 13y ago
      Or you can buy puts and the most you're out is the amount you paid for the option. If you're looking to play around with some money - basically playing a gambling game with companies - then options are a fun little game and you can manage your downside perfectly.
- colinbartlett 13y ago
  To add to this, just remember one simple fact: When you are a long a stock, the most you can lose is the amount you paid. When you are short, you can lose unlimited money.
  - giarc 13y ago
    I don't trade stocks, nor do I claim to know that business at all. Can you explain this concept?
    - bcbrown 13y ago
      A short is borrowing stock to sell, promising to re-buy that stock in the future to give back to the lender. The stock price can rise arbitrarily high, which means you may have to pay an arbitrarily high price to re-purchase the stock in the future. See "short squeeze" and read about the Volkswagen/Porsche example a couple years back.
    - scotch_drinker 13y ago
      If you buy a stock at 10 and it goes to zero (the bottom limit), all you lose is your $10. If you short a stock (thinking it's price will go down), there is no upper limit on how far it can go up. If it continues to go up, you're going to lose the amount of money at which you eventually "buy to cover". For example, if you hold your short until the price is $100, you lose $90.
      - giarc 13y ago
        Could you not hold forever?
        minimax 13y ago
        No. As the value of the position (price times size) approaches the cash balance in your brokerage account, your broker will close out your position (buying back the shares) using the funds in your account. This is known as a "margin call."
    - 13y ago
omellet 13y ago
There aren't any options yet, they'll probably start trading later next week. After that you can trade them through e*trade or whatever.
apaprocki 13y ago
You can open an E*Trade account and then apply for whatever options level (1-3) you desire. You'll be asked questions about whether you understand the options market and assume the risks. There are then specific requirements for how much cash or marketable securities you need to have in account if you want to buy puts or sell calls.
deleted 13y ago
[deleted]
kirpekar 13y ago
E*trade allows shorting stocks and writing covered puts at Level 2. The default (Level-1) allows only covered calls. They have an online application process. Usually chances are higher if you are trading over $100k.
johnymontana 13y ago
You can always short the stock, but that is quite risky as your maximum downside is theoretically infinite (the stock can always go up). A bearish options strategy[1] can at least define your risk. Thinkorswim[2] options platform is my favorite, they were acquired by TD Ameritrade a while ago, but the thinkorswim platform is still independent from the larger TD Ameritrade system. [1] http://en.wikipedia.org/wiki/Options_strategies http://en.wikipedia.org/wiki/Options_strategies [2] www.thinkorswim.com
- svachalek 13y ago
  Theoretically. In practice you're going to get margin called and locked into a loss of approximately 100%.
beauzero 13y ago
Use optionsxpress. Cheap, reliable, and they actually have online educational seminars that will help you understand the risks.

by cft 13y ago

Can someone advise what's the best way to buy derivatives (etrade,scottstrade, etc): the fastest way to open an account, the best order execution times? I want to invest some money to short this.

joshmlewis 13y ago

I was wondering this as well. Trading stocks always seem a little out of reach for some reason.

adventured 13y ago

If you didn't catch a short on it near $50, wait. The stock market bubble is going higher under Yellen's dove policy. The valuation crazy tech stocks like TWTR or LNKD will go that much higher accordingly. This market doesn't drop until the Fed stops or the market goes so high it is forced to crash (runs out of oxygen, everybody panics, mass selling ensues, down goes the latest bubble).

RyanZAG 13y ago

There's a lot of paperwork and checks involved. No matter what route you go, it will take some time.

MichaelApproved 13y ago

Please don't take this as snark but I wouldn't recommend shorting anything if you are so inexperienced that you don't have a trading account or don't know which one to use. Shorting stocks is extremely risky and should only be done by traders with lots of experience. If you really want to bank on Twitter going south, you can try buying puts when they're available. If you're not sure what puts are, leave this whole idea alone.

cft 13y ago
i run a bootstrapped company that i founded in 2006, and i have some extra money i am totally comfortable of losing entirely. i view this as an experiment. i am looking for a serious practical advice.
- MichaelApproved 13y ago
  I would still recommend against it but you should know that shorting isn't always available right after a stock IPOs. It can take about a month before its possible. Its been a while since I've dealt with IPOs so I'm not 100% sure if that's the case anymore. If you want to get involved, call TD Ameritrade. They can give you 100% accurate information and get you setup quickly.
- derwiki 13y ago
  But that's exactly the danger with shorting, your losses aren't capped by what you put in. A stock can only drop to 0, but it can go up to whatever -- you have no upper bound on losses. Do whatever you want, but know what you're doing. http://www.investopedia.com/university/shortselling/shortselling3.asp http://www.investopedia.com/university/shortselling/shortsel...
- grmarcil 13y ago
  Consider this carefully: "When you are a long a stock, the most you can lose is the amount you paid. When you are short, you can lose unlimited money." If you have "funny money" that you aren't afraid to lose, there are safer and more responsible ways to experiment with the market than unprotected short positions. You may want to read about and understand some options strategies: http://www.investopedia.com/terms/b/bearputspread.asp http://www.investopedia.com/terms/b/bearputspread.asp http://www.investopedia.com/terms/b/bearcallspread.asp http://www.investopedia.com/terms/b/bearcallspread.asp Either one of those strategies gives you the opportunity to profit a certain amount if the stock actually goes down (the width of the spread times the quantity), while limiting your exposure to just the premium you pay for the options. Your exposure is limited because you both buy and sell puts or calls for equal amounts of the underlying, so you have no net exposure to the price of the underlying. A general word of advice about playing the market for short term gain: big guys make money off of little guys. You may win some, but usually you are doing damn well as a small time trader if you're batting above 500 at all.
  - MichaelGG 13y ago
    Or you can buy puts and the most you're out is the amount you paid for the option. If you're looking to play around with some money - basically playing a gambling game with companies - then options are a fun little game and you can manage your downside perfectly.
colinbartlett 13y ago
To add to this, just remember one simple fact: When you are a long a stock, the most you can lose is the amount you paid. When you are short, you can lose unlimited money.
- giarc 13y ago
  I don't trade stocks, nor do I claim to know that business at all. Can you explain this concept?
  - bcbrown 13y ago
    A short is borrowing stock to sell, promising to re-buy that stock in the future to give back to the lender. The stock price can rise arbitrarily high, which means you may have to pay an arbitrarily high price to re-purchase the stock in the future. See "short squeeze" and read about the Volkswagen/Porsche example a couple years back.
  - scotch_drinker 13y ago
    If you buy a stock at 10 and it goes to zero (the bottom limit), all you lose is your $10. If you short a stock (thinking it's price will go down), there is no upper limit on how far it can go up. If it continues to go up, you're going to lose the amount of money at which you eventually "buy to cover". For example, if you hold your short until the price is $100, you lose $90.
    - giarc 13y ago
      Could you not hold forever?
      - minimax 13y ago
        No. As the value of the position (price times size) approaches the cash balance in your brokerage account, your broker will close out your position (buying back the shares) using the funds in your account. This is known as a "margin call."
  - 13y ago

omellet 13y ago

There aren't any options yet, they'll probably start trading later next week. After that you can trade them through e*trade or whatever.

apaprocki 13y ago

You can open an E*Trade account and then apply for whatever options level (1-3) you desire. You'll be asked questions about whether you understand the options market and assume the risks. There are then specific requirements for how much cash or marketable securities you need to have in account if you want to buy puts or sell calls.

deleted 13y ago

[deleted]

kirpekar 13y ago

E*trade allows shorting stocks and writing covered puts at Level 2. The default (Level-1) allows only covered calls. They have an online application process. Usually chances are higher if you are trading over $100k.

johnymontana 13y ago

You can always short the stock, but that is quite risky as your maximum downside is theoretically infinite (the stock can always go up). A bearish options strategy[1] can at least define your risk. Thinkorswim[2] options platform is my favorite, they were acquired by TD Ameritrade a while ago, but the thinkorswim platform is still independent from the larger TD Ameritrade system. [1] http://en.wikipedia.org/wiki/Options_strategies http://en.wikipedia.org/wiki/Options_strategies [2] www.thinkorswim.com

svachalek 13y ago
Theoretically. In practice you're going to get margin called and locked into a loss of approximately 100%.

beauzero 13y ago

Use optionsxpress. Cheap, reliable, and they actually have online educational seminars that will help you understand the risks.