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I was willing to initiate a credit spread some days ago to my local broker here in
Belgium.
That was the 1st time I decided to include a short "leg" in an option trade (I usually
trade only long spread).
This was the order (note: AEX is the Amsterdam Stock Index and it was at 894 pts at
Friday close) :
Sell 1 Put AEX Sept 890 and Buy 1 Put AEX Sept 870.
As you see, the maximum loss is 20 pts if the index is at 870 or below at expiration.
This maximum loss represents exactly GLD 1151 (GLD = dutch currency), commission
included.
Thus I was convinced that the answer of the broker would be: margin = around GLD 1200.
Well, not at all: I have to put the same margin as if I was selling naked puts: in this
xase it is a 100% margin !!!!!
Is it normal ??
I think it is not, and I intend to look for another broker.
What is usually the margin required in the example above?
If someone of you knows of a broker operating also in Amsterdam or other European market,
and who practice more "normal" margin, I would really appreciate that know his
coordinates.
Thank you for all opinions,
Carl
Carl Vanhaesendonck
Brussels
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