Overview
Features of the Window
Option Levels
Field Definitions
- Create an Options Order
- Specify Contracts
- Set Trade Preferences
Enter brokerage account orders for listed option securities. To execute options trades, Fidelity requires an option agreement and in some cases a margin account.
A Positions panel at the bottom of the window enables you to select from an account's existing positions to prefill the order ticket. (Features of the Window)
When selling contracts from a nonretirement account, you can continue with the cost basis disposal method already selected for the account (default), choose an alternate disposal method for the transaction, or specify the contracts to be sold. When the latter is selected, Wealthscape directs you through the specific contract workflow so you can choose the lots to deplete.
There are a number of features built into the ticket that are designed to provide access to the tools and information that support the order process.
Account Search
At the top of the window, locate other accounts to enter orders without leaving the ticket. (Search for Accounts)
Account Cartridge
Below Account Search, view account information, balances, and firm and investment information for an account. (Account Cartridge)
Quote
After you enter a valid symbol or CUSIP for a security, access its quote information or security details.
Positions-Open/Unrealized
In the panel at the bottom of the window, view open/unrealized positions for an account. By default, option positions display, but you can change this to view other positions for the account including All Securities, Equities, or Mutual Funds.
Prefill Orders
In the Security ID column, select a link to display a menu of actions that enables you to create an order for the position. For an option, choose Close/Decrease Position and Open Increase Position. Fields that prefill include Action and Symbol/CUSIP. (Set Trade Preferences)
Orders-Unsent
View unsent orders for the current account or for all accounts to which you are authorized. By default, unsent option orders display, but you can change this to view All Securities, Equities, or Mutual Funds.
Manage Orders
From Orders-Unsent, you can edit, delete, and send a selected order. If you choose a single order containing a Lock or Error icon in the left-most column, the Send Selected Orders button does not activate. Position your pointer over an icon to view its message.
Select Trade > Order Entry > Options.
- If prompted, search for an account. (Search for Accounts)
Select the Action.
Enter the Quantity, which is the number of contracts for the order.
- This value must be a whole number.
Enter the Symbol/CUSIP and press Tab. (Option Chain Lookup)
When you tab away from Symbol/CUSIP, a Quote link enables you to access pricing information for the security.
Specify the Price Type:
M-Market
L-Limit
S-Stop Loss
SL-Stop Limit
Note
If you enter a Stop Price for the order, the Limit Price automatically updates to be equal to the Stop Price.
If Price Type is Limit, select the Time in Force.
If Good til Canceled, you may enter an Expiration Date. The default expiration date is the contract's expiration date.
Note
If Price Type is Market or Stop Loss, Time in Force is Day and cannot be modified.
Choose the Account Type:
Cash (1)
Margin (2)
Enter remaining order information. (Field Definitions)
If Action is Buy/Sell Calls to Close or Buy/Sell Puts to Close, to choose an alternative cost basis disposal method, select a Transaction Disposal Method. (Cost Basis Disposal Methods)
If Specify Contracts, skip to: Specify Contracts.
Select one of the following:
Save
Saves the order to send later. A confirmation displays.
Verify
Verifies that no errors exist that may block the trade. If an error is found, incorrect fields are highlighted in red. Enter corrections before attempting to proceed with the order. If no errors, a Verification window displays trade details to review before proceeding with the order. To make changes, select Edit. To send the order to the market, select Send Now.
Send Now
If entitled; sends the order to the market. A confirmation notifies you that the order was sent.
Continue with the steps below after selecting Specify Contracts as the Transaction Disposal Method for the order.
If entitled, the cost basis disposal method you designate on the ticket is used for this specific order and does not replace the account's established cost basis disposal method. Use this capability on a closing transaction to deplete specific tax lots within the account.
Transaction disposal method override does not apply to the following cases:
- Opening transactions.
- Retirement accounts.
- Account type 0 (DVP/RVP).
- Positions with an Average Cost Disposal Method.
- Lots purchased intra-day.
Contracts identified for a specific contract order will be reported on the customer confirmation if the order fills. Contracts left unspecified are depleted using the account-level cost basis disposal method. Note, too, for a specific contract order, you cannot save the order; you must send the order to the market.
- Prefill Specific Contracts
- Enter Contracts Manually
This window displays only if the account's position is in good order (IGO) and cost basis is fully or partially known. If partially known, only known basis lots display.
From the Pre-Fill Selections drop-down lists, indicate how to prefill contracts to sell based on your sort choices; select one or both sorts.
From Prefill by Holding Period, select a primary sort based on holding period:
No Preference (Default)
Short-Term
List contracts held less than the minimum holding period first. These contracts may be subject to redemption (short-term trading) fees. See the option's prospectus for more information.
Long-Term
List contracts held longer than the minimum holding period first. These contracts may not be subject to redemption (short-term trading) fees. See the option's prospectus for more information.
From Then By Cost, select a secondary sort based on cost:
No Preference (Default)
Highest Cost
Pre-fill tax lots with the highest cost basis/share information first.
Lowest Cost
Pre-fill tax lots with the lowest cost basis/share information first.
Minimizing Gain/Loss
Attempt to identify high cost basis and low cost basis/share. There is no guarantee that gains or losses will be offset, in whole or in part. Results vary.
Select Prefill.
Running totals update dynamically as you specify contracts. Contracts Specified plus Contracts Remaining (or unspecified contracts) must equal Total Contracts in Order. Contracts in the order left unspecified are depleted FIFO.
Select Verify.
If the order is validated, the Verification window displays, which allows you to review order details prior to sending the order. If no errors, select Send Now.
Go to: Search for Sent Orders
Fidelity provides cost basis and associated realized gain/loss information as a courtesy service. Such information may not reflect all adjustments necessary for tax reporting purposes.
In the Cost Basis/Contracts field, enter the price per share at which the contracts in the lot were purchased.
If contracts were purchased over multiple dates or at different prices, you may split the lot into multiple lots. For example, if the quantity with unknown cost basis is 200 contracts, which represents 2 separate purchases of 100 contracts each, enter cost basis for the first 100 contracts, then enter cost basis for the remaining 100 contracts in the next row.
Continue adding contracts until you reach the limit or number of contracts in the order. Select Add Rows to add more lot information. Below the table, Contracts Specified plus Contracts Remaining must equal Total Contracts in Order. Contracts in the order left unspecified are depleted FIFO.
Select Verify.
Go to: Search for Sent Orders
- Options Order Entry
- Specific Contracts
| Field | Definition |
|---|---|
| Account Type | The type of account involved in the order: Cash (1)
|
| Action | The order action: BCO-Buy Calls to Open
|
| Client Confirm Note | The power of discretion for the order, which displays on the trade confirmation:. Advisor Directed
|
| Expiration Date | If Time In Force is Good Til Canceled, this is the expiration date if other than the system default of the contract's expiration. Enter the date or use the calendar icon to select the date. If you specify an Expiration Date other than the system default for a Good Til Canceled order:
|
| Limit Price/Stop Price | The limit price or the stop loss price for the order; the label of the field varies based on the Price Type selection. |
| Price Type | The price type for the order: L-Limit
|
| Quantity | The quantity of the order, which displays in contracts and must be a whole number greater than 0. |
| Special Condition | A special order condition: All or None (AON)
Not Held (H)
|
| Stop Price | If Price Type is Stop Limit or Stop Loss, this is the price at which the order will execute. |
| Symbol/CUSIP | The symbol or CUSIP of the security involved in the order. |
| Time In Force | How long the order is valid: Day
Good Til Canceled (GTC)
Fill or Kill (FOK)
Immediate or Cancel (IOC)
|
| Transaction Disposal Method | If Action is Buy Calls to Close, Sell Calls to Close, Buy Puts to Close, or Sell Puts to Close, this is the alternative cost basis disposal method for the order, which does not replace the account's established cost basis disposal method. You may also choose to specify contracts for this order. (Specify Contracts) |
| Field | Definition |
|---|---|
| Contracts Specified | If using the cost basis information that Fidelity is tracking, enter the quantity of contracts from each tax lot to appoint for the order. |
| Contracts Available | If using the cost basis information that Fidelity is tracking, a list of all tax lots for the position displays. Each tax lot has an available quantity. |
| Date Acquired | The date the contracts were added to the Fidelity account, in MM/DD/YYYY format.
|
| Lot Basis | The total cost basis of contracts in the position: Contracts Available X Cost Basis/Proceeds per Contract |
| Cost Basis/Contract | The calculated cost of one contract of the security. Cost basis is generally the original amount paid for contracts of a security, including the amount of reinvested dividends and capital gains, plus or minus certain adjustments such as fees and commissions paid at the time of purchase. If the position is held short, this amount represents the proceeds per contract. |
| Unrealized Gain/Loss | The hypothetical value of the gain or loss that would be realized if contracts were sold at the indicated price. |
| Holding Period | How long the contracts were held since their acquisition date: Short
For stock option grants, this refers to the amount of time stock options must be held before they can be exercised. The holding period requirements for stock options are described in the vesting schedule for your stock option grant. |
| Cost Source | The origin of the cost basis information: Fidelity
|
Fidelity provides certain cost basis and holding period information to you and to the IRS on your annual Form 1099-B and provides other cost basis and associated realized and unrealized gain/loss information to you as a courtesy. Such information may not reflect all adjustments necessary for tax purposes. Taxpayers should verify cost basis, associated gain/loss information provided by Fidelity against their own records when calculating reportable gain or loss resulting from a sale. Although Fidelity reports certain cost basis information to the IRS, Fidelity is not responsible for your use of this information in meeting your federal, state, and other tax obligations. Fidelity makes no warranties with respect to, and specifically disclaims any liability arising out of your use of, or any tax position taken in reliance upon, Fidelity-provided cost basis and gain/loss information.
Fidelity determines the appropriate cost basis method for calculating gain and loss based on positions held at the time of sale. Unless otherwise indicated, Fidelity determines cost basis using the average cost method for open-end mutual funds. For securities other than open-end mutual funds, Fidelity determines cost basis using the first-in, first-out (FIFO) method if Fidelity does not receive appropriate specific share instructions. Fidelity determines cost basis using the specific share identification (SS) method if Fidelity receives appropriate specific share instructions; however, such cost basis information may not correspond to an end-customer's cost basis information records if an end-customer used the specific share identification method prior to the time that such method tracking was made available by Fidelity.
End-customers should consult with their tax advisors for further information.
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