Depending on the options strategy you use, we may hold stocks or cash as collateral to make sure you can cover the position in the case of assignment.
Collateral Held in Stock
Selling to Open a Covered Call
Collateral Held in Cash
Selling to Open a Cash-Covered Put
Opening a Credit Spread
You’ll be able to see exactly what collateral we hold on the Detail page of the underlying stock.
We won’t use Gold Buying Power as collateral. We must hold cash.
When you place an options order, we’ll hold the appropriate collateral (cash or stock) beginning at the pending state. The same way we hold enough cash to fill your pending order when you open an equity position, we’ll hold enough cash or stocks to cover your option position until the order is canceled.