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IBKR TWS Python API – Case Study in Pair Trades

IBKR TWS Python API – Case Study in Pair Trades

Posted June 18, 2019 at 9:15 am

IBKR Quant
Interactive Brokers

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In this video we move beyond core API functionality and build on previous lessons to examine a case study in which advanced order types may be advantageous in implementing a specific trading strategy.

The TWS API supports more than 60 of the order types and attributes available in TWS. Here we consider a scenario in which the Pegged-To-Primary/Relative order type is used, with orders in a hedging pair trade to place related orders for two different instruments, such that placement of the second order is handled automatically by the IBKR server.

We walk-through the code of a Python program to place the initial and the hedging order and demonstrate how they will appear in TWS. Throughout the lesson, please keep in mind that the examples discussed are purely for technical demonstration purposes, and do not constitute trading advice. Also, it is important to remember that placing trades in a paper account is recommended before any live trading.

To see other short videos in this series, visit our API news section. For the entire course in Python see ibkr.com/ibta.

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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.

The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Interactive Brokers, its affiliates, or its employees.

Disclosure: Displaying Symbols on Video

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

Disclosure: Order Types / TWS

The order types available through Interactive Brokers LLC's trading platforms are designed to help you limit your loss and/or lock in a profit. Market conditions and other factors may affect execution. In general, orders guarantee a fill or guarantee a price, but not both. In extreme market conditions, an order may either be executed at a different price than anticipated or may not be filled in the marketplace.

Disclosure: Margin Trading

Trading on margin is only for experienced investors with high risk tolerance. You may lose more than your initial investment. For additional information regarding margin loan rates, see ibkr.com/interest

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