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Contributor: Interactive Brokers

Level: Advanced

This series of lessons will help deepen your understanding of options and discuss the many available TWS tools investors can use to analyze the market before making a trade. Each lesson focuses on a single tool or approach to a valuable concept about the options market.

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Lesson: #1 TWS OptionTrader

This Traders’ Academy lesson will explain the layout and some of the features of TWS OptionTrader. OptionTrader displays market data for the underlying, allows you to create and manage options orders including combination orders, and provides the most complete view of available option chains, all in a single screen. This lesson will help users immerse themselves in a configurable options trading module where they can monitor relevant data and submit orders.

Lesson: #2 Entering Option Spreads & Combinations with Strategy Builder

A spread order is a combination of individual orders (or legs) that work together to create a single trading strategy. In this Traders’ Academy lesson we’ll review how to enter these orders in TWS using Strategy Builder for Option Spreads.

Lesson: #3 Options Write/Rollover Tool

In this lesson we'll discuss the TWS Write Options tool which may be used to sell calls against long stock positions and sell puts against your short stock positions. We'll explore the TWS Rollover Options tool to roll over options that are about to expire to a similar option with a later expiration date.

Lesson: #4 IB Probability Lab

Use the IB Probability Lab to analyze the market's probability distribution, which shows what the market believes are the chances that certain outcomes will occur. This tool can be used to locate potentially profitable trading strategies for stocks and options in the event that your view on a stock is different from that of the market. This lesson will explain how to navigate and utilize the Probability Lab.

Lesson: #5 IB Volatility Lab

This lesson will explore the IB Volatility Lab which is a useful trader dashboard providing a snapshot of past and future readings for volatility on a stock, its industry peers and some measure of the broad market. Use the Volatility Lab to compare and contrast the option market’s view on the volatility of a stock over the coming months. We’ll take a look at how to view implied and historical volatility and industry comparisons, and much more!

Lesson: #6 Option Selector

This lesson will explore the TWS Mosaic Option Selector which can be opened when adding an underlying to your Quote Monitor. The Option Selector displays option chains and may be customized to display different expirations, strikes, trading classes and more!

Lesson: #7 Performance Profile for Options

This lesson will explore the Performance Profile window for options. Investors may use the Performance Profile window to examine the P&L potential for simple or complex option strategies while considering trades, as well as monitor existing positions from the portfolio window.

Lesson: #8 Building an Option Centric Market Scanner in Mosaic TWS

Many traders like to watch for changes in implied volatility, option volume or open interest to gauge prospects for stock prices.

Lesson: #9 Estimated Price Range

In this lesson we’ll show you how standard deviations can be plotted on a TWS Chart for eligible securities using the estimated price range parameter.

Lesson: #10 Rolling Options

In this lesson learn how soon-to-expire options in your Interactive Brokers account can easily be rolled over to a further strike or expiration date in the same underlying ticker using the Roll Over Options tool.

Lesson: #11 Pegged Volatility Orders

This lesson will discuss the Pegged Volatility order type which may be used to place orders to buy and sell options according to volatility levels associated with option premiums. We’ll walk through Pegged to Primary, Pegged to Market, Pegged to Midpoint and Pegged to Surface order types.

Lesson: #12 Entering Option Spreads & Combinations with the Combo Selection Tool

A spread order is a combination of individual orders (or legs) that work together to create a single trading strategy. In this lesson we will review how to enter these combination and spread orders in TWS using the Combo Selection tool.

Lesson: #13 IB Risk Navigator – Calculating the forward prices for options

This lesson will show you how to use the Custom Scenario within IB Risk Navigator to estimate the forward price for option contracts.

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