Options Analytics Tools

Discussion in 'Options' started by blange, Mar 24, 2009.

  1. blange



    I'm a new options trader and am looking for recommendations for options analytics software. I'll need to be able to do theoretical pricing, portfolio analysis (i.e. complex option strategy analysis), backtesting, and risk management analysis. Right now I'm working with the analytics tools in ThinkOrSwim, but need more sophisticated modeling capabilities.

    Here are a couple I've found:
    1) Hoadley
    2) OTrader
    3) OptionVue (this one's out of my price range, unfortunately)

    Personally, I'd prefer software that hooks into Excel, since I may want to build custom macros on top.

    Any suggestions would be much appreciated.

  2. dmo


    I use Hoadley and am very happy with it. I love the flexibility of it being basically a library of Excel functions. I use the strategy evaluation tool too. For $100 you can't beat it. I used to use Montgomery Investments' add-ins - they're excellent but many times more expensive.

    I don't know Otrader but looking at their home page this doesn't seem to give much specialized option analysis power.
  3. Carl K

    Carl K


    Also TradeStation

    There is no magic to software. It serves a function,
    but can not think, does not understand market movement.
    Consider a cars "Cruse Control", it can be useful, but not in traffic.
    The "real world" is too dynamic for computer modeling,
    consider weather forcasts, or spell checkers.

    Google whatever you are looking for, someone will be willing
    to show you how well it works, and take your money.
  4. I concur in regard to Hoadley.

    I can also suggest leasing OV6. That's what I decided to do - I can stop when I wind my trading down over the summer, and pick it up again when I want to, if I want to.
  5. blange


    Thanks for the suggestions, guys. For those of you who use Hoadley - do you also use ThinkOrSwim? As far as I can tell, almost all of the features (except the 3D modeling capability) that are included in Hoadley's analytics tools are also included for free in the TOS platform, so having both of them seems redundant unless you want to build custom functions on top of Hoadley's. Am I missing something?
  6. I use TOS and IB. TOS has absolutely killer option modeling features. You can do risk graphs for arbitrarily complex option spreads. You can also play around with what if scenarios like "what if IV goes from 45% to 30%?" You'll see the effect of changes like this on the risk graph.

    Very nice.
  7. Andrico


    I would also suggest to have a look at
    Option Oracle from http://www.samoasky.com/

    It's 100% free and allows live data access for IB clients.

    By the way, those of you who have Hoadley tool, could you comment on it in comparison to Option Oracle?

  8. dmo


    For me the most important part of the Hoadley tools is simply the Excel option functions, which allow me to set up a spreadsheet to look at things any way I want. You can't do that with option oracle or any off-the-shelf software.

    For example, let's say I want to look at the skew in Crude. I want to look at it and chart it in a particular way - I want to calculate theoretical values of every option using the ATM IV, then display how many ticks over or under that price the actual price of each option is.

    I don't know of any software that will display it that way, but it's simple to create an Excel spreadsheet that will - if you have the option functions.

    Another example - if you're looking at VIX options, TOS and other software uses the cash VIX index as the underlying. Let's say I prefer to use that month's VIX futures contract as the underlying. In my own Excel spreadsheet, I can set it up that way or any way I want. I can experiment. I can try it this way and that way and see if any "new look" yields any new insights.

    Options oracle appears to be just for stocks. That's not the whole options universe. You can use Hoadley for options on futures, currencies, etc.

    Hoadley also has lots of interesting toys to play with. Everyone knows by now that the lognormal distribution doesn't correspond to either actual option prices or actual real-world probabilities. Hoadley has the ability to adjust skewness and kurtosis if you wish to try to tackle the problem that way.

    If you're into options and enjoy spending time tinkering with them, Hoadley will give you lots of entertainment, and also the means to delve into options in ways that you probably never thought of.
  9. I downloaded and tried this. It's very polished for a free tool.
  10. Chuck_T

    Chuck_T eSignal

    #10     Apr 7, 2009