Use the Strategy Builder to easily build complex, multi-leg strategies using the option chain display. Create strategies manually using the calls/puts in Tab or List View. Create Horizontal, Vertical or Diagonal spreads using the Spread Builder layout. You can open Strategy Builder from the Advanced Options Tools section of the New Window dropdown, or by toggling on the Strategy Builder button at the bottom of the Option Chain window.
To create a strategy using Calls and Puts layout:
- From the blade at the top of the window, ensure that "Calls and Puts" is selected.
- Tabbed View lists all strikes for the selected expiration tab.
- List View lists all options for all expirations.
- Add legs to your strategy by clicking the Bid price to sell a leg or on the Ask price to buy a leg. Note that Calls are listed on the left side of the chain, and Puts on the right. Options colored in blue are in-the-money.
- Define the order parameters in the Order Entry row. Next to the price the "Debit" or "Credit" sign indicates if this is a debit spread or a credit spread. A credit spread (negative price) implies receiving a net payment upon execution.
- Click on Submit Order, review the Order Confirmation and note the "D" debit or the "C" credit next to the previewed Limit Price and Transmit.
You can also pick a named strategy from the Strategies list (Box, Butterfly, Calendar Spread, Iron Condor, Straddle, Strangle, Vertical Spread, etc.) in the top right corner of the Strategy Builder panel to automatically complete a strategy based on the first leg.
Additional Information
- How can I compare and create complex, multi-leg option strategies?
- Why are some of the options in the Option Chain shaded?
- Find out more about the Strategy Builder in the TWS Users' Guide