How to Start Trading Options in My Investment Account
Summary of Main Problem and Solutions:
- The user, Jose787pr, is unable to invest in options because their current investment account does not support options trading.
- To begin options trading, Jose787pr needs to apply for options trading on their existing account through Fidelity’s website by following specific steps.
- The same cash available in the account can generally be used for options purchases, but uncollected deposits cannot be used for opening options transactions.
- Applying for options does not automatically create a new account; it can be done on any eligible existing account.
Here’s the full thread
I would like to invest in options. I have realized that my investment account does not have the option to make options. Would I have to open a separate account to be able to make options?
Hi, @Jose787pr! To begin investing options, you will first need to apply for options trading on your account.
You can apply on Fidelity.com by following the listed steps:
1. Hover over “Accounts & Trade” in the top left corner and select “Account Features” in the dropdown
2. Under the “Brokerage & Trading” section click on “Apply” by “Options.”
On this next page, you can see which of your accounts are eligible for options and proceed to apply. It is important to note that options approval decisions are based on your trading experience (including experience trading stocks/ETFs, mutual funds, bonds, etc.), financial situation, and investment objective. Because different options trading strategies involve varying degrees of risk, approval requirements are more rigorous for higher options levels approval. We approve an applicant for the highest level for which they are eligible, up to the level requested.
Learn more about trading options at Fidelity: https://www.fidelity.com/options-trading/overview
Let us know if you have additional questions!
Options trading entails significant risk and is not appropriate for all investors. Certain complex options strategies carry additional risk. Before trading options, please read the Characteristics and Risks of Standardized Options (http://www.optionsclearing.com/about/publications/character-risks.jsp). Supporting documentation for any claims, if applicable, will be furnished upon request.🟢
okay. Can I use the same money I have for training or do I have to deposit separately for this new options account?
Thanks for following up with us, @Jose787pr. Generally speaking, your “Cash available to trade” amount within your account is available for options purchases as well. Keep in mind that if you’ve made a recent deposit into your Fidelity account from an outside financial institution, those funds may be subject to a collection period from your bank. Fidelity allows you to purchase securities using uncollected deposits, subject to security type and daily limit restrictions; however, uncollected funds cannot be used for opening options transactions. You’ll receive an error code on the trade ticket if attempting such a trade.
I also want to clarify quickly that applying for options does not automatically open a new account. As long as you have an open account that is eligible for options, you’ll be able to apply for the feature on that account when you follow @FidelityCaitlin‘s instructions above. If you do open a new account, or you have multiple accounts, you would need to refer to your “Balances” page to confirm you have sufficient cash to support the trade you want to place.
If we can answer any other questions, let us know!
Options trading entails significant risk and is not appropriate for all investors. Certain complex options strategies carry additional risk. Before trading options, please read the Characteristics and Risks of Standardized Options (http://www.optionsclearing.com/about/publications/character-risks.jsp). Supporting documentation for any claims, if applicable, will be furnished upon request.