Many wonder if it’s possible to trade 0DTE options trading on Fidelity. Let’s break down the facts.
Can You Trade Zero-Day Options (0DTE)?
Yes, Fidelity does allow trading Zero-Day options, but there’s a catch. You’ll need an account with a minimum balance of $1,000,000. This requirement may seem hefty, but it’s in place to safeguard against the risk of assignment.
Some argue that this reasoning doesn’t hold up, considering that trading 1DTE (one day to expiration) options is permitted without such a high account balance.
Differences Between SPX and SPY 0DTE Options
If your Fidelity account doesn’t have over $1mm, you can still trade zero-day options on the SPX.
SPX options are cash settled, meaning there’s no risk of assignment. On the other hand, SPY options may involve the actual transfer of shares, hence the restriction.
| Aspect | SPX Options | SPY Options |
|---|---|---|
| Settlement Method | Cash settled | Physical assignment possible |
| 0DTE Trading Allowed | Yes | No |
Conclusion
In summary, to trade 0DTE options on Fidelity, you’ll need an account holding a minimum of $1,000,000. Also, remember that Zero-Day options are already allowed for SPX without an account balance requirement.