I haven't really familiarize myself with the trading platform very thoroughly. I've seen some videos of trade station and think or swim that show three-dimensional graphs and all kinds of representations of different kinds of risk graphically which I wasn't able to quickly find an interactive brokers.. Does anybody use the trader workstation and interactive brokers to evaluate their different risks in each trade as well for their entire book.. Or are people using proprietary software or some other thing.. My other question as well relates to graphing volatility over time. Is there any place or way through Excel or something to graph the implied volatility versus the realized volatility. Because all things aside as one of the most important things to get familiar with in the underlying securities that I follow. I've been doing so much reading and all it makes me do is think about reading more. And then after more reading I realize that I'm probably can I drown myself in information and end up completely confused haha..
The risk graphs in TWS sucks tbh. If you want a proper risk graph, hook TWS up to Excel and graph it there. As for plotting real vs impl, open up the underlyer in a chart, rightclick the chart - > chart parametres -> check the tickbox for "option implied volatility" and "historical volatility". Be aware that the measures for historical volatility are a joke, as they average it over 30 days. So if there is a huge gap one day, realized vola will appear super-high for all 30 days despite only being high in the gap area.
Wow.. some good s some good smoothing of reality to completely distorte it.. I was thinking about messing around with excel. I'll have to do some research on how to hook up to ib with it.. its been a while since I've used excel to any degree of complexity..
To be honest, I believe all brokers smooth HV out like that. It's extremely misleading IMO. Personally I download underlyer data and run my own HV calculations and compare to historical IV on a day-to-day basis. Much more realistic that way. I also delay IV 30 days and graph it vs HV to check predictability of IV. Here is the link for IB API software. It's pretty simple, just download software and follow instructions. http://individuals.interactivebrokers.com/en/p.php?f=programInterface&ib_entity=llc
I also know YHOO has a group for IB API stuff. I am a member of that group but thst is too much for me and I rarely check it. Lots of code developers there.
Interesting. I know PHP HTML CSS cold fusion and I took a class in visual basic I am positive being able to program in a lower level language just to even be able to.really dig into the data in different ways has to.help!
Yes, it helps immensely. Words cannot explain how helpful Excel and it's VB has been to my trading. I couldnt do any of this with any retail platform, ever.
I can't wait to mess with it.. does it show you live changes in graphs . What kinds of things to.you use it for . Mainly volatility?
Yes, the graphs change live. All calculations as well. I use it for a ton of stuff, analysing risk, greeks, graphing risk / prices, backtesting, pricing vol, data visualization when you've got a ton of it and the numbers are just a blur...I also trade from it, got it automatically managing delta risk throughout the day, automatic order submissions to underlyer and options, autotrack midpoint so i dont have to manually work the spread, portfolio management, PnL tracking by individual greeks, autofetch hist data at end of day, automatically analyze data and save analysis for future use, auto-this and that...my goal is to be as automated as possible.
I don't trade options much except for hedging sometimes but when I do I use OptionsOracle by SamoaSky. You can also use their online tool which is in many cases better than the offline tool, and it also has free live data which is updated at a reasonable pace. You can design the legs and move the time to expiration to see how theta affects your legs, etc. For something more advanced, there are of course better applications out there but not free, but it certainly beats using Excel (unless you are very specific about what risk/pricing models you want to use, which you don't need to be at this level).