Hi guys,

I'm looking into some options trading in ES futures with IB and have some very basic questions, but cannot seem to find any sites specifically to answer my questions, hence the thread

First of all, assume ES futures currently at 900, let's say I purchased a put at 950 for a premium of 50 ($2500), my understanding is that this option can be sold at the market prior to expiration at a profit/loss as long as it suits me. On expiration, I will end up with a short futures contract with a price of 950 if the option is ITM on expiration, or it will simply expire worthless (does this mean this position would simply disappear off my IB account?). How often do people exercise futures options? I assume you just leave the options position and let the broker do the work?

I notice in IB that you do not always have a bid/ask prices, so does this mean, say I have an option that I want to get rid of prior to expiration, however there is no bid price, so I will simply have to settle with expiration? How can one be sure of being able to offset their position? Eg. a Put at 875 in IB currently has no bid prices, however at 860 there are quite a few bids, why is this?

Lastly, according to IB site, there is no margin for long options (http://individuals.interactivebroker...?ib_entity=llc), however when I preview an order of a put at 3 ($150), it added some $500 to my margin requirement?

Thanks very much for any help!