Need Very Simple IB Help--Spreads

[lc_match-aka-Bill 2]

Mostly I've used TDA's stuff---their simple text-based order entry, including spreads, and then their Trade Architect which is really quite convenient.  I'll use TOS a bit, but my monitor is small--a problem.  Don't think I've ever needed a help screen.  

 

So I got an IB account and feel like a fool.  I'm having huge problems navigating.  I did manage to buy a RUT vertical, but the only way I can find to sell it would be 1 leg at a time.  And pricing the spread was a pain...I just looked over at TDA to do that because all IB would show was the bid/ask of the individual legs.  So 2 obvious questions:

1. When you're originating a spread, can IB quote you the spread price (not just the bid/ask of the options?) 

2. In disposing of a position, is there a way to do it as a spread?

 

I've got about 9 hours of their webinars downloaded, so I'm headed there, just thought I'd ask.

[Saud 5]

yes you can do all that and more

 

Here's what I do (and there are many ways to accomplish the same thing in IB):

 

Open Option Trader (and keep it open always) and start a new tab for each underlying. I like to use the Combo builder under Trading on that page, right above the Option Chains. All you have to do is click on the ask or bid of the relevant strike and expiry and it populates the fields there. Then you can "add to Quote Monitor", helpful if you want to watch it or set up and bunch to transmit a bunch of spreads at once.

 

Once it's in the quote monitor just highlight the combo and click the "order ticket" button underneath (I also like to have the "preview order/check margin" and "close position" buttons there, among others, plan on spending a good number of hours configuring TWS the way you like it). The combo shows up in Orders below and you can modify, enter the limit etc. and transmit from there.

 

To close, same thing from quote monitor, just use the "close position" button (but be careful to check the limit price before sending it off). I've found that's the safest and fastest way to do it, as it ensures you've got the correct strikes, expiries, number of contracts etc (not that anyone would ever mess that up ).

 

I hope that helps somewhat.

[Marco 223]

if you don't want a tab on the options trader for every underlying you trade you can also add different spreads, stock, options ... all on one 'quote monitor' page in TWS. To add combos right click on any line and choose generic combo - and either chose from default strategies or create a custom combo.

Let me know if you don't manage to do it from that description and I go into more detail. 

[lc_match-aka-Bill 2]

Yeah, that helped, both thanks.  Finding the combo spreads was somewhat non-intuitive.

[Marco 223]

I find IB has a lot of powerful tools and functions but they didn't manage to put that in a very easy to use and good looking GUI like TOS. It's fine once you know how it works ...

[lc_match-aka-Bill 2]

So I see.  How about a bear call spread?  I'm in their spread trader, selecting strategy, expiry, strikes, and the vertical spread will only do bull call?  Hints?  I'll get back on the webinars this PM.

[Marco 223]

yes vertical spread - after you select the expiry you select whether call or Put spread.

 

Edited August 29, 2013 by Marco

[lc_match-aka-Bill 2]

Thanks for your help.  I'll get there.  Apparently I'm in a different tool.

[Micahjw 3]

But the vertical spread seems to only be for debit spreads, they don't seem to have anything for credit spreads. I guess you just use the pair or leg by leg section for that? Also, on the option trader (which thanks for mentioning, I hadn't used this before), how do you get things populated on that? There's nothing in the option chains, trading or quote panel sections.

[lc_match-aka-Bill 2]

Depending on which buttons you push, you get different spread builders.  Watching the webinar I  learned to first, after opening the Options Trader to immediately customize and 'Add Remove Toolbar' option.  That gives you a top row of buttons in which you can click on 'Option Spreads' which brings up the tool Marco posted.  Then you can choose to Buy or Sell a vertical.

[Marco 223]

yes you can create debit and credit spreads this way. IB has an odd/confusing way of displaying the price depending on how you put the spread in. So sometimes it will show you a negative premium and then you have to be careful on what it actually means if you buy or sell that spread. If you hower over the description though it will tell you. Something like 'buying this spread means buy that, sell that'

I prefer to create the spread in a way that I put in the more expensive leg(s) on the buy side in the spread builder even if i want to sell it so then I get a positive premium and then buying it means I buy the more expensive leg (and sell the other) selling it means I sell it - which make more sense to me then selling a negative premium to buy the spread ....

[lc_match-aka-Bill 2]

Somehow I sold 2 verticals today after reading the 6 pages of IB stuff on the Forum from last year and this.  Sold 1 using a positive limit, got the market; sold 1 using a negative limit, got the market.  Lots of fun.

[Micahjw 3]

This has been the most confusing part of it for me too - I've also accidentally sold something at a very bad price because I didn't have the negative/positive set right with the spread. Very un-user friendly. I've been with and used over 5 online brokerages and this is definitely the most confusing when it comes to spreads. Love their prices though, so very willing to put up with stupid layout and lack of user-friendliness.

[Mikael 31]

I wish they would redesign the stupid GUI on IB. seriously they can just literally copy ToS and they would gain so many more customers.

[lc_match-aka-Bill 2]

They're most likely going to lose one.