Risk Graphs

Last modified 11:47, 5 Nov 2012

Graphs Tabbed Page

Once you have created your options strategy on one of the Strategy tabbed pages, click on the Graphs tab to view and analyze the strategy you have created.

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This tab lets you view the price chart for the underlying security (on left) as well as charting the profitability of the strategy.

For details on the floating window which is displayed on the chart, see Option Analysis Strategy Palette.

Graph Display Function Bar

Your SOFTWARE gives you a number of tools that lets you adjust the way that the graphs are displayed.

These tools can be accessed using the buttons on the Graph worksheet's function bar:

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The following tools are available to manage the Graph display:

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Download the latest prices too refresh both the underlying security's price chart and the strategy's risk graph from the HUBB server.

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Display the drop-down Action menu.

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Enable Streaming data.

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Save the Chart.

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Analysis floating palette.

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Display the Price Target for the underlying security. Price targets can be set in the price chart using the Price Target drawing tool or trade scanner feature. When a data linkage is established, the target area will be displayed in the Risk Graph.

See the Price Target Drawing Tool's topic for more information.

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Hide or display the Price Chart. Hiding the price chart gives more room for the profit charts to be displayed.

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Display the values of the Greeks for the selected Strategy. Select a strategy in the Analysis floating palette, see above.

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Display the Transactions for the Strategy selected in the Analysis floating palette. This table will be displayed in place of, or below, the Greeks, see previous.

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Zoom into a highlighted section of the chart.

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Reset the chart scales to the default setting.

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Increase the Chart Scale by clicking the upward pointing arrow, this will increase the chart area. To decrease the chart area, click the downward pointing arrow.

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Click the crosshairs button to Center the chart’s axes on the screen. Click the left facing arrow to shift the chart to the left, click the right arrow to shift right.

Adjusting the Chart Properties

Many of the function bar buttons affect both the underlying asset's Price Chart (on left) and the option strategy's Risk Chart (on right).

Price Chart

The price chart of the underlying symbol is displayed in the left chart pane of the Graph's work-page.

Hide or display the Price Chart by toggling its Hide/Show button on the function bar: butn_prichart.gif

opanlys_graphpopup.pngSingle right mouse click anywhere on either chart to open the Graphs pop-up menu.

The four commands in the bottom section control the amount of data included in the price chart of the underlying asset.
If the analysis is saved, the amount of data selected will be displayed the next time the Analysis is opened.

Use the function bar's Zoom button on a portion of the chart to enlarge it. After zooming-in, select Reset Scales to display data for the number of months selected in the pop-up menu.

The pop-up menu's Graph Properties... commands apply mainly to the Risk Graph, see the Option Analysis Properties topic.

The function bar's Increase / Decrease Scales applies to both the price chart and the risk graph.

Risk Graph

The Risk Graph displays risk profiles of each of the strategies defined in the strategy work-sheets.

The strategies' risk profiles can be displayed all at the same time, or individually, or any number at the same time.

In addition to the risk profiles, the software can also generate price lines and bands or bars indicating levels of standard deviation.

Risk Graph settings are principally in two locations: Analysis palette and Option Analysis Properties dialog.

Commands for controlling the actual display of the Graph on the work-page are largely found in the function bar.

Analysis palette

The floating Analysis palette contains controls for the display of each Strategy's risk profile and options data tables, containing both Greeks and Transactions data.

It also contains controls for the Profit Line display and forecast and brokerage settings.

For more information, go to the Option Analysis Strategy Palette topic.

Option Analysis Properties

Other settings for the Risk Graph display are contained in the Option Analysis Properties dialog box.

To open the Option Analysis Properties dialog box, either

  • Single right mouse click anywhere on either chart to open the Graphs pop-up menu, then select the first command, Graph Properties..., or
  • Drop down the function bar's Action menu, and select the Graph Properties... command.

Either command will open the Option Analysis Properties dialog box.

The following items are controlled from the dialog box

  • Risk Graph Orientation controls
  • Price Target display controls
  • Profit Line Legend display
  • Standard Deviation Band/Bar Settings
  • Profit Line display and parameters settings

See Option Analysis Properties for further details.

Risk Graph Display Controls

The function bar contains a number of commands that relate directly to the display of the Risk Graph on the Graphs work page:

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Hide or display the Price Chart to create more room for the Risk Graph.

Toggle the button to show the Price Chart.

The Risk Graph cannot be turned off.

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Display the Price Target for the underlying security.

Price targets can be set in the price chart using the Price Target drawing tool or trade scanner feature. When a data linkage is established, the target area will be displayed in the Risk Graph.

See the Price Target Drawing Tool's topic for more information.

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Zoom into a highlighted section of the Risk Graph.

This will effectively enlarge the view.

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Reset the chart scales to the default setting, effectively this will un-do the zoom..

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Adjust the Standard Deviation of the Risk Graph by typing in a number between 0.5 and 6.

The following commands appearance will change depending on whether the profit scale is horizontal or vertical:

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Increase the Chart Scale by clicking the upward pointing arrow, this will increase the chart area. To decrease the chart area, click the downward pointing arrow.

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Click the crosshairs button to Center the chart’s axes on the screen. Click the left facing arrow to shift the chart to the left, click the right arrow to shift right.

Refer to the Risk Graph Orientation topic in the Option Analysis Properties topic for more information on "flipping" the Risk Graph's display.

Profit Lines

Profit lines provide a graphic display of the effect of time decay on the price of the strategy. The lines are based on the model price and pass through the prices that the option should be worth based on the number of days to expiry.

In addition to the full effect of time decay based on all the days to expiry, users can also show three other lines at intervals in between the current date and the date of expiry.

For more information on the lines and how users can over-ride the system defaults, refer to the Profit Lines and Time Analysis section of the Using Risk Graphs topic.

The display of the price lines is controlled by the Analysis palette, for more information, go to the Profit Line Controls section of that topic.

The default settings for the lines are set in the Profit Lines tabbed page of the Graphs Properties dialog box.

Data Tables

At the bottom of the Graphs work page are three tables: Greeks, Profit Line Data and Strategy Legs.

The Profit Line Data table will always be displayed. The other two can be toggled on or off via their respective buttons in the Graphs function bar.

Greeks

When the Greeks function bar button butn_optanlysgreeks.gif is selected, the Profit/Loss and all of the Greeks for the line currently selected in the Analysis palette are displayed. The table has columns for the values calculated for a number of strike prices on either side of the current price.

For a full explanation of the Greeks, and their calculation, go to the Option Graphs Greeks topic.

When more than one Strategy is in the Graph, use the Strategy display selector in the top part of the Analysis palette to display the profit line details of a different strategy in the Greeks table.

To change the profit line whose Greeks are currently displayed, use the central line controls of the Analysis palette.

Profit Line Data

The data in this table cannot be turned off and will always display the data for the selected profit line.

To change the profit line whose Greeks are currently displayed, use the central line controls of the Analysis palette.

For more information, go to the Profit Lines Data section of the Using Risk Graphs topic.

Strategy Legs Data

The details for all the transactions that form part of a strategy will be displayed in the bottom table when the function bar's Transactions button butn_optanlystransactns.gif is selected.

When more than one Strategy is in the Graph, use the Strategy display selector in the top part of the Analysis palette to display the Legs Data details for a different strategy.

The table contains the same information as contained in the Legs Details table at the bottom of each Strategy work page.

For more information, go to the Strategy Positions Details Table section of the Strategies work-page topic.

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