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Interactive Options Course
Lesson 7 of 9
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Discover a powerful options research tool available free within Trader Workstation (TWS).
Options traders often spend significant time searching for strategies, evaluating risk, and wondering how a trade idea might have performed in different market environments. What if much of that research had already been done?
Interactive Brokers clients have access to the ORATS Backtester directly within Trader Workstation (TWS), providing a vast library of pre-calculated options strategy backtests covering popular stocks, ETFs, and indexes. The tool allows traders to review historical performance, compare strategies, and evaluate risk characteristics before committing capital. [interactiv…rokers.com], [orats.com]
Whether you’re evaluating covered calls, credit spreads, short puts, iron condors, or other common options strategies, ORATS can help you move beyond assumptions and begin your research with historical data.
ORATS (Option Research & Technology Services) provides options research tools, data, and analytics used by professional and retail traders alike. Within TWS, the ORATS Backtester gives IBKR clients access to a large collection of historical options strategy tests that can be searched, filtered, and analyzed directly from the platform. [interactiv…rokers.com], [interactiv…rokers.com]
The backtester includes:
The goal is simple: help traders evaluate how a particular strategy has historically performed under specific conditions.
Imagine you are bullish on a stock and are considering several approaches:
Which approach has historically offered the best balance between return and risk?
Without historical analysis, traders often rely on intuition, anecdotal evidence, or recent market experience. Backtesting provides another perspective by showing how similar strategies performed over many years and through different market conditions.
While historical performance never guarantees future results, reviewing long-term data can help traders:
In other words, backtesting turns a trading idea into a research project.
Finding the tool is straightforward.
Step 1: Launch the ORATS Backtester
In TWS Mosaic:
The tool opens in a separate window.
Step 2: Start with the Welcome Page
The Welcome page provides an introduction to ORATS and includes educational material designed to help users become familiar with the platform and its capabilities. [interactiv…rokers.com]
New users should spend a few minutes reviewing this page before exploring the more advanced sections.
Step 3: Explore Featured Backtests
For many traders, the Featured Backtests section is the ideal starting point.
This page displays high-ranking backtests based on current criteria and updates regularly. The table includes information such as:
Selecting a strategy opens a detailed analysis window where traders can study the results in greater depth. [interactiv…rokers.com]
Many traders assume they must build complicated spreadsheets or write custom code to evaluate options strategies.
ORATS takes a different approach.
The platform gives traders access to a large collection of historical research that can be searched and filtered in minutes. Rather than starting with a blank screen, users can begin with strategies that have already been analyzed across years of historical market data. [orats.com], [interactiv…rokers.com]
This can be particularly valuable when exploring:
Suppose you’re interested in trading Apple (AAPL).
Rather than immediately placing a trade, you could use ORATS to:
This approach allows traders to begin their analysis with data rather than speculation.
In the next article in this series, we’ll walk through a practical example using Apple (AAPL) and show how ORATS can help traders compare multiple options strategies on a single underlying before making a trading decision.
The ORATS Backtester is one of the most powerful yet underutilized research tools available within TWS. By providing access to a vast database of historical options strategy tests and detailed performance analytics, it allows traders to spend less time guessing and more time evaluating ideas based on evidence. Before your next options trade, consider starting with a backtest. The research may already be waiting for you.
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.
Options involve risk and are not suitable for all investors. For information on the uses and risks of options, you can obtain a copy of the Options Clearing Corporation risk disclosure document titled Characteristics and Risks of Standardized Options by going to the following link ibkr.com/occ. Multiple leg strategies, including spreads, will incur multiple transaction costs.
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.
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