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Wednesday, July 25, 2012

Think Or Swim & Tasty Trade - the next step

Gather 'round, boys and girls, I've been on another search for option information. You know me, I can't sit still and need to know the best sources for everything.

I'm going to talk about Tasty Trade in my next post, but first I want to talk about my new option broker platform.

I've been doing business at OptionsXpress (my brokerage) for almost three years now, but another platform called Think Or Swim (part of TD Ameritrade) came to my attention. I had seen it before, at the beginning of my trading, but considered it too complicated to learn and went on to OptionsXpress, instead. I like OX very much; it's clean and easy to use, no doubt about it. But until now I didn't have needs that OX could not satisfy.

So, when the software of ThinkOrSwim.com was recommended to me, I decided to take another look.
It is still complex, but what I have discovered in this business is that it all takes work. The platform has some videos under "Help" which are not terribly useful, but there is another old website of theirs that has some really good training videos, and so I started there. Here's how to find them, a well kept secret: http://mediaserver.thinkorswim.com/support/learningCenter/tos_learningcenter.html

Mind you, some of the videos for the more complex functions like "Analyze" are not functional on this old website. For that, you have to subject yourself to the Seminars which are given daily and archived under "Support/Chat" tab on the platform itself. And this is where the training really starts, once you know the basics of how to navigate around. The coaches who do these seminars (and especially Don Kaufman) are quite brilliant and hold forth for as long as 3 hours every day, if you can find the time to watch and listen.


I don't pretend to even begin to know all the wonderful software that TOS offers. The Analyze tab is a mystery, but I have seen Don Kaufman do wonderful things with it. I just haven't got it all in my head yet. So the list of special things is very long, and all of which is not known to me yet.

The thing that really caught my eye, however, was the flexibility of the option chains. There is a dropdown menu and you can pick different column-layouts for the chain, giving you access to the Greeks, to volatility, open interest, Intrinsic, Extrinsic, theoretical value and volume with just a click. In addition you can customize the columns to whatever you want as a default setting. It's terrific!

But the BEST park is two columns: "Probability OTM" or "Probability ITM" that are available which give you a likely probability (depending on your strategy) of whether you will be in or out of the money at time of expiration. This is the MOST wonderful data to have at your fingertips when you're trading. For example, in the Call chain below, if you sold the $52.50 Strike, you would see that there's about a 73% chance of staying out of the money by expiration. These are mathematical computations and not written in stone, of course, but what a help!

I'll address more about this after we get into Tasty Trade.


I can give you a couple of good reasons. The fees are negotiable, the service is quite good, and it offers a brand new approach to trading when coupled with the philosophy of Tom Sosnoff (creator and former owner of Think or Swim); and best of all, if you open a new account with TD Ameritrade (the ThinkOrSwim platform is a free download), you get a FREE subscription to the new Sosnoff website "Tasty Trade. com." which I will cover in my next post. ##