ThinkOrSwim - beware

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kevinrudd's picture
Joined: 06/18/2011
Hat Tips: 4
Posts: 2
ThinkOrSwim - beware

I trade futures options (mostly short) and have had some (unpleasant) experiences to share re ThinkOrSwim.

The desktop software is good - and shows your current positions marked-to-market. Unfortunately the real-time margin data displayed is frequently (big time) wrong. 

Both of my accounts showed $20k+ in 'cash available to withdraw'. Yet I received an email notifying me of a margin call of more than $20k each account (i.e. the TOS display is "green", and telling me I have 20k spare cash in each account, yet the margin call says I owe $20k cash/account).

I called the TOS margin team - how can I be margin called when I have spare cash in both accounts ??????

The margin guy explained that their real time margin data displayed is wrong (so sorry) and that I am indeed being called for $20k/account. It was explained I shouldn't use the TOS-supplied margin data - instead I should register for a daily position update email from Penson (TOS clearing broker). 

Bottom line was that I was over positioned and had to close out a bunch of positions at a loss (my loss - margin calls have to be met in 24hrs, and by this time it was not possible to transfer funds in). Nowhere in any TOS documentation is it explained that their margin calcs are wrong - you don't find out until you blow up your account.

Because the margin on futures options is calculated using the SPAN system it is not possible for a retail trader to calculate the margin himself - you have to rely on your broker.

Clearly I am not the only client to experience this 'feature' - TOS now only trade Crude (CL) options for the nearest 3 months - all others months have been delisted. I queried this and the guy on the help desk tried to tell me you cant trade options out more than 3 months on Crude because they don't exist - I told him he was talking crap (because I had actually been trading them the previous year) . I later got an email explaining TOS no longer supported trading on CL options "because of issues calculating margin".

Potential TOS clients you have been warned.

Edited by admin on 11/08/2014 - 06:16
Sterling's picture
Joined: 06/14/2011
Hat Tips: 2826
Posts: 266
Thanks for the warning - I

Thanks for the warning - I use TOS.  I'll keep an eye on that.


Can I offer you a drink? How about this expensive prostitute?

magis00's picture
Joined: 06/14/2011
Hat Tips: 413
Posts: 108
Holy Crap.

That's unbelievable.  Very appreciative of the warning; I'm a "regular TD" user and very wary of margin, but will be sure to keep an eye on mine without relying on them to do so...since apparently they're unable to.  Bastiges!

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