Weekly Live Data On Demand Trading

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Weekly Live Data-on-Demand and Trading

Your SOFTWARE has the ability to stream live data into the option chain data tables and price charts. When used within an Options Analysis work page, trading strategies and risk graphs are valued using live market data. For more details on how to setup, construct, value and trade option strategies using live streaming, see the topic Live Data-on-Demand and Trading.

Using live data quotes is a very useful feature for short term traders looking to take advantage of Weekly options and their leverage.

Note: The Live Data feed function only works with instruments in the US market and users must have an OptionsXPress trading account.

Trading Weekly Options Using Live Data Feed

Your SOFTWARE can be setup to trade Weekly options via the live Data on Demand feed. A suggested screen setup for this style of short term trading would be to open a Price Chart side by side with an Options Analysis work page each on the same stock to be analysed and traded.

For example, a price chart using an intra-day timeframe (such as 1min) can be placed on one side of the screen and the equivalent options analysis work page can be placed on the other side of the screen with the relevant Weekly options displayed. An Option Filter can be setup to only display the Weekly options by selecting a filter to show options 1 month or less.

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The live Data on Demand feature can then be enabled for both charts to track price chart movements and option trading strategies in real time.

To enable live Data on Demand in the Price Chart, click the butn_go-off.gif icon. Similarly, in the Option Analysis work page, click the same butn_go-off.gif icon. Real time price data should now flow through to the Price Chart and Option Analysis Data Tables.

A trading strategy can now be constructed for analysis. See the section Constructing a Live Trade Strategy for more details. A Call option trade example is shown below.

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Note the Date and Time highlighted in the top left of the screen. The Time shows that the trade strategy was placed at 10:19:40 AM and the highlighted prices reflect the live market quotes at that time.

Switching to the Graphs tab will display the risk profile of the trade based off the live market prices. Once again, the Time highlighted in the top left corner shows the risk profile reflecting the market prices at 10:19:40 AM.

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The newly constructed trade strategy can now be Saved for future reference or modified for further modelling and analysis.

Valuing a Live Weekly Option Strategy

To value or mark to market a Weekly options trade, click the green butn_go-off.gif button from the Analysis Function Bar.

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This will stream the current live market price during market trading hours or the end of day quote if the market is closed. All trade valuation figures and risk statistics will update and reflect the new market quotes.

The Price Chart will also need to be updated with the live Data on Demand quote by clicking on its green butn_go-off.gif button from the Price Chart Function Bar.

Once both charts have been updated, the Price Chart and Option Analysis results and figures will reflect the live market quote at the time.

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The new Time shows the trade is now valuing at 10:25:29 AM which is displayed in the top left corner of the screen. The Bid/Ask quotes will reflect the new market prices as highlighted above. In addition, the Trade Value, Profit/Loss and option Greeks will also be revalued based off the new market prices.

Clicking on the Graphs tab will also show the updated risk graph based off the new market quotes.

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The Time shows the trade is now valuing at 10:25:29 AM. The Bid/Ask quotes will reflect the new market prices as highlighted above. In addition, the Forecast, Profit/Loss and option Greeks will also be revalued based off the new market prices.

This feature can also be used to mark to market existing trades to get their current value and risk graph profile. Simply Open an existing saved trade analysis and enable the live Data on Demand streaming. Then clicking the green butn_go-off.gif button will activate the live price and value the trade accordingly.

Trading a Live Weekly Option Strategy

Live streaming quotes within Your SOFTWARE are provided by OptionsXPress. Therefore, any trade strategies analysed using the live streaming function can be sent directly through to the OptionsXPress broker platform for trade execution via the Buy or Sell commands.

This is a great feature for Weekly options traders who need to get their trades into the market quickly without having to change trading platforms.

Clicking the green butn_go-off.gif Data on Demand button will update the option chain with the latest market prices which can be used to trade directly into the live market. For example, a live trade may consist of Buying 1 At-The-Money Call option for the current price quote of $5.95. To determine the trade is live, check the Time field which will show a live clock with the hours, minutes and seconds.

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Selecting the active options and right mouse clicking enables the pop-up menu. Then selecting the Buy command will open an Order Entry ticket that is directly linked to the OptionsXPress trading account.

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An Order Entry ticket is opened in the Options tab consisting of the Call option and number of Contracts that were in the Options Analysis screen. The Action field defaults to BTO (Buy to Open) as a Buy trade was triggered. If Sell trade was initially triggered, the Action field would default to STO (Sell to Open).

For option trades, the Order Type defaults to Market and the Market $ defaults to the Ask price of the option. In the example above, the default price is set to $5.95. The Expiry defaults to Day Order.

If traders wish to day trade a fast moving market using Weekly options, the Market order type may be the appropriate order type to use as this will give traders the best chance of an immediate price fill.

Alternatively when trading in the options market, it is typical to enter orders using the Limit order type. A simple Buy trade is usually executed at a Net Debit and the price set from the Options Analysis of the strategy can be used as an entry price. The example below shows an entry debit price of $5.95 which was the result of an Options Analysis. However, traders can place any price they are prepared to pay in this field.

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To enter this value in the order ticket, change the Order Type to Limit and set the Limit $ to $5.95. The Expiry is set to Day Order which means the order will only be active for the current trading session. Check the All or None box. This means the order will only get executed if all the contracts specified can be filled. In the example, just 1 Contract must be executed in order to get the trade filled.

Traders need to be aware that using Limit type orders may not always get executed in a fast moving market where the bid/ask spread is moving away from the limit entry price. This is more apparent when using Weekly options due to their short term time value and faster moving properties.

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Clicking on the Submit button will send the trade to the OptionsXPress trading platform. If the trade was sent successfully, a message will be returned informing that the order was accepted by OptionsXPress and a receipt number will be issued. If the trade was unsuccessful, an error message will be returned explaining the reason why the trade failed to get sent to the OptionsXPress trading platform.

Users can double check that orders were sent correctly by opening the Broker Account View within Your SOFTWARE and selecting the specific options trading account to see the order status. Alternatively, users can log into their OptionsXPress web trading account and checking the Order Status page to see if the trade exists.

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