Best option for options?

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shipship

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Hi, I'm interested in buying some long dated puts in a specific company

What's the best option?

I just want to buy a small position. I know IB is meant to be best but they require a large deposit.
 
Does it have to be an option?

What about a spread bet? It's a lot riskier but if you manage the risk, they seem like better value. I used IG to spread bet on Bitcoin going down and it's a very good interface.

Having said that, I would have preferred to buy a put option, but I couldn't find any.

Brendan
 
Thanks for the reply.

I'm looking for puts over a specific timeline, I think it's better suited risk/reward wise than an outright spread bet.
 
shipship said:
I'm interested in buying some long dated puts in a specific company
What's the best option?

I just want to buy a small position. I know IB is meant to be best but they require a large deposit.
Click to expand...
Tradestation?
 
if you want to buy a put in a specific company then you must feel this company is heading for a kicking. The big disadvantage in owning this put is time. Time will cause this put to lose value over time and so unless the share price of this company falls you will lose value. The spread bet might better buy
 
shipship said:
Hi, I'm interested in buying some long dated puts in a specific company

What's the best option?

I just want to buy a small position. I know IB is meant to be best but they require a large deposit.
Click to expand...

In general, any broker platform should allow you to buy exchange traded options just as you would any equity. You would just need to know the exchange they are traded on and identify the ticker - which will depend on the underlying share, the date of expiry and the strike price.

Long dated options can be tricky. Option prices are driven by the underlying share price, the volatility of the price and time. So when you trade long dated options, the time portion becomes a more significant portion of the price. This decays over time - so even if you are right fundamentally on the underlying share direction, you can still not make money on the option trade. The time decay gradually accelerates as you get closer to expiry so one way to try to minimise this is to trade the option dated beyond your planned date (e.g. if you are looking at the price going down in 12 months, then buy a 2 year put). But this also make the initial option more expensive.

There is no "deposit" when buying options - what they are looking for is the option premium (the cost of the option). It should be the same no matter which broker you use as they are usually quoted on an exchange. However, if you go with spread bets (as some suggested), you run the risk of the underlying equity going up in price in the meantime and you will be required to pay more margin. Possibly more than you can afford. At least with an option, your cost is limited to your upfront premium.

If the underlying equity is US, have a look at LEAPs. They are long term options which are much more affordable. I'm not sure if there are versions of LEAPs in Europe
 
In terms of options and covered calls, would any of you have any recommendations on online training resources (books, udemy intro courses, more expensive training, etc) ?
 
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When you say you want to buy "put" options

You're suggesting the price is going fall

What sector are you envisaging will fall?

Brexit related? Bet against sterling?
 
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