Why don’t brokerage firms offer option strategies?
Brokerage firms discourage their clients from utilizing options for two primary reasons: Money and Time, in that order. Brokerage firms will not offer discounted commissions on options, therefore, they charge excessive amounts four or five times the normal discounted rates. This would harm the performance of any option strategy, and they know this to be true. The brokerage firm wants its brokers to earn large commissions on products such as annuities, mutual funds, and wrap fees. A few years ago, Jim Neher was offered a job as a broker at a major firm whose manager actually sold options on his personal account, but not for clients. He told Jim that he admired his rationale for option selling, but he would learn to abandon the strategy for clients when he realized that he could earn a much larger income selling other services and products. Respectfully, he turned down his offer. Brokerage firms also need to perpetuate the illusion that their research and market savvy makes you money, no
