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Duration: 2:29

Instructor:

Contributor: Interactive Brokers

Level: Intermediate

Create a short put in Trader Workstation (TWS) using Option Chain.

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Study Notes:

From a Watchlist on the Monitor tab, click the underlying symbol you wish to create your options trade for. So long as your tabs are part of the same Windows Group, the underlying will appear in the Order Entry panel.

To the right of the Order Entry panel select Option Chain from the dropdown menu. The Option Chain display shows call options to the left and put options to the right of the central strike column. You will see the price and daily change of the underlying to the upper right of the window. Above the Call area you will see tabs for different expirations. Click a tab or to locate additional expiration dates, click on the More tab.

  • Above the Put area you will see a dropdown menu for Strike prices. Access this menu to change or refine the number of strike prices displayed on the page.
  • Hovering the cursor above any bid price displays a red background. This indicates that by clicking on the field would create an order to sell that option. Hovering above any ask price displays a blue background indicating that clicking on that field would create an order to buy that option.
  • Clicking a single strike will close the Option Chain window and populates the Order Entry panel with the chosen option leg.
  • Locate the desired option strike you want to transact.
  • Click on the relevant price field, which will close the Option Chain display.
  • Use the Order Entry panel to define the quantity of options to trade. Choose the right order type from the dropdown menu. If using a Limit price, choose the value by clicking in the input field or simply typing in the value. Select from the Time-in-Force dropdown whether this is a Day or GTC order. Your order is ready to review. Click the Submit button to generate an Order Confirmation.
  • When you have reviewed the details, click Transmit.

The order is sent for execution at the exchange and will appear in the Activity panel to the lower left of Mosaic. To pause or interact with an active order click on it in the Activity panel and make the relevant choice.

Disclosure: Interactive Brokers

The analysis in this material is provided for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IBKR to buy, sell or hold such investments. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

Supporting documentation for any claims and statistical information will be provided upon request.

Any stock, options or futures symbols displayed are for illustrative purposes only and are not intended to portray recommendations.

Disclosure: Options Trading

Options involve risk and are not suitable for all investors. For more information read the “Characteristics and Risks of Standardized Options” also known as the options disclosure document (ODD). To receive a copy of the ODD call 312-542-6901 or click here. Multiple leg strategies, including spreads, will incur multiple commission charges.

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