Safe mode advanced options trades
The system also supports handling of phone orders, diversion of trades, and in-depth analysis of order processing history.
This approach enables managers to instantly grasp the situation in user accounts and ensures on-the-fly respond to user requests. The application enables to create and edit user accounts and to change and fix various parameters for each client or account, including contact details, permissions, and various settings.
Advanced Devexperts technology enables the application to effortlessly process thousands of quotes per second from multiple data providers without delays and breakdowns.
The system allows managing of service data, such as lists of instruments and specifications. The application supports various report formats provided for users and different organization departments: The application receives and distributes quotes from all US stock, option, and futures markets in real time.
To meet these requirements the system processes up to 1 incoming messages per second on 1U box and distributes up to five million messages per second.
Dedicated high performance integration modules let the application receive market data from multiple different vendors both exchange related and independent. This allows for redundancy and full access to all kinds of information. Feature-rich application system thinkorswim is a fully-integrated system that provides effective and useful tools for all groups of the system users from traders to order-, risk- and account-managers, and back-office people. Extensive functionality for options trading The platform provides an extensive set of software tools for all levels of private trading and makes options trading very easy to grasp even for a beginner.
Effortless trading from anywhere The platform functionality is also available through a wireless software application to provide easy personal trading possibility on any pocket pc enabled device as well as Blackberry and iPhone.
Flexible and easy-to-use trading environment thinkorswim trading platform is empowered with the most intelligent interface that can be easily adjusted to meet individual options, futures and stock trading style. Cost-effective integration with data vendors and executing brokers The application receives and distributes millions of quotes per second from major stock, options and futures markets in real time and is configured to work with all major executing brokers; FIX protocol connectivity provides cost-effective, direct access to any number of local and global liquidity providers required for business activities.
In-depth displaying of market trends thinkorswim trading platform is integrated with a sensitive charting engine providing real-time updates of market data and allows for in-depth viewing of market situation. Powerful charting engine thinkorswim trading platform includes a powerful charting engine that supports both historical and live data, provides streaming data updates, and is fully integrated into the system.
Advanced analytics All option Greeks are calculated on the fly each time the live data is updated. Advanced options strategies The platform allows advanced users to enter, send, and execute a wide range of option strategies verticals, calendars, butterflies, condors, etc. Real-time margin calculations All analytical values whether it be portfolio risk factors or option valuations are updated in real time with respect to the movements in underlying and option prices. Effortless market scanning The application is integrated with a powerful stock scanner that enables to filter stocks according to multiple parameters specified by users and current market conditions, and the built-in scanner for option strategies allows for easy and quick search of strategies required for selected stocks.
Algorithmic orders thinkorswim trading platform supports a wide range of algorithmic orders and can be customized to route them in automatic mode according to multiple parameters specified by the users.
Risk management The platform enables to determine risk factors across multiple accounts in real time. Order Management The application features a comprehensive trade desk interface that enables to track orders at each stage of order routing and execution. Account Management thinkorswim trading platform provides the same interface layouts for clients and account managers.
User account management The application enables to create and edit user accounts and to change and fix various parameters for each client or account, including contact details, permissions, and various settings. Liquidity in the options market can have a very different profile than equities; naively applying a conventional equity pair algo to the options market is susceptible to market impact by continually pushing to execute. For example, an algorithm that constantly trades when the pair hits the desired spread may hold the market from providing price improvement and potentially signal to the market that there is an algorithm at work.
While sourcing equity and option liquidity across multiple venues has implicit legging risks, these can be minimised with the right tools. Most applications have a rather limited response when a leg gets hung up; they either immediately go to market or pop up an alert. Neither response is particularly helpful; the first increases execution costs perhaps substantially , while the second compels the trader to react possibly prematurely.
Better alternatives include allowing the trader to specify a time limit before further action, in case the market drifts back in the right direction of its own accord. If this doesn't happen, a second stage would be to enable the trader to grant the application a specific degree of price discretion. A further method of maximising control of a multi-legged trade that includes equity options is pegging.
In an ideal world, the trader needs the facility to peg each leg of a trade to a benchmark, which could be volatility or delta or just a target spread value. Upper and lower bounds set on either side of these benchmarks can then be used to control the execution algorithm behaviour, such as pauses. A further advantage is if the pegging is in line with a market benchmark.
As the underlying equity rallies, the trade becomes less attractive. Strategies that combine equities and options can easily create a risk management and book-keeping nightmare. Therefore any trading application needs to be tightly integrated with both the trader's blotter and middle and back office systems. A common situation where this degree of integration is especially valuable is where the trader is working in the same name across multiple strategies.
A very simple example of this would be selling multiple calls delta neutral against the underlying stock but where only half of these were a vol sale, while the remainder were part of a vertical spread. The ability to both separate and combine the view of these transactions hugely simplifies risk management and back office admin, as well as minimising operational errors.
By the same token, being able to access the application's functionality in another trading application such as an execution management system also adds significant workflow value. For example, many traders like to be able to run a potential strategy in simulation mode and then activate it with real capital if performance proves satisfactory. Therefore the trading application needs to be tightly integrated with analytical and graphical tools that will allow the calculation and display of all risk factors associated with the strategy, both historically and in real time.
While there might once have been a measure of truth in this, times have changed.