Options Trading Account Levels

When you apply for a brokerage account, brokerage firm will assign you the account trading level ranging from level 1 to level 5 based on your Trading Experience and Net Worth.

Level 1

• Covered Call writing
• Protective Put

Level 2

• Level 1 
• Calls and Puts Buying
• Writing of cash Covered Puts 
• Purchases of straddles or combinations

Level 3

• Levels 1 and 2
• Equity DEBIT spreads 
• Covered Put writing

Level 4

• Levels 1, 2, and 3, 
• Equity CREDIT spreads, 
• Naked (uncovered) writing of equity options 
• Uncovered writing of straddles or combinations on equities

Level 5

• Levels 1, 2, 3, and 4, 
• Uncovered writing of index options, 
• Uncovered writing of straddles or combinations on indexes, and index spreads.