Friday, June 30th 2023
How to See Open Interest and Volume for Every Strike in the Trade Builder
Use the Trade Builder to visualize the options chain on a graph and interactively build single or multi-leg trades.
ORATS' Trade Builder offers a graphing tool that allows traders to view historical data and a clear vision of the options chain. Traders can view open interest and volume for every strike, and interactively assemble any single or multi-leg options trade. The breakeven line shows the stock price point required for the trade to breakeven.
In the dynamic world of options trading, the availability of real-time, detailed information can make all the difference. With ORATS' Trade Builder, that difference is manifested through an impressive graphing tool that not only allows you to view historical data but also offers a clear vision of the options chain. In this post, we'll explore the unique features of the Trade Builder and how they can elevate your trading decisions.
An Introduction to the Trade Builder
The Trade Builder provides a unique visualization of the options chain, which allows for a simplified, comprehensive view of the market. Essentially, the options chain is flattened onto a 2D surface, where expiration dates and strike prices are represented on the x and y-axis respectively. The tool offers the flexibility to pan left or right, thereby providing a view of more historical data or future expirations, while also allowing for zooming in or out for a broader data perspective.
Viewing Open Interest and Volume
To make the most of the Trade Builder, we first collapse the left menu bar for better visibility. Following that, a leftward drag on the graph brings future options into view. After disabling the volatility overlay, only the open interest and earnings overlays remain active.
The weekly expirations can be observed on the right side of the graph, marked by light grey lines. By hovering over these lines, strikes start appearing in popups, offering all essential information, including bid and ask price, open interest, and volume for both call and put sides.
By toggling on the volume overlay, the graph transforms to display volume. The call volume is represented by cyan bars, while put volume is highlighted in purple. The relative width of these bars adjusts as per zoom level, allowing for finer detail upon zooming in. In the picture below, the X-marks highlight which strikes and expirations have a relatively large amount of volume.
Trading Directly from the Trade Builder
The Trade Builder enables you to assemble any single or multi-leg options trade interactively. Hovering over the desired expiration and strike brings up four buttons for selling or buying a call or put. Once a leg is added to the graph, the trade opens in the sidebar, where all updates made to the trade will reflect on the graph and vice versa.
The breakeven line is a significant feature displayed as a blue line on the graph. This line indicates the stock price point required for the trade to breakeven. Paired with the IV range overlay, it helps determine whether the breakeven point is within the expected 1 or 2 standard deviations of movement.
The Trade Builder also enables the transformation of a single trade into a spread by adding another leg. Legs can be conveniently adjusted on the graph by dragging them to different strikes or expirations, where they automatically snap to the closest available options.
With its unique ability to visualize the options chain and assemble trades directly, ORATS' Trade Builder significantly enhances the options trading experience. It promises to deliver the comprehensive information and convenience necessary to make strategic trading decisions.
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Use the Low IV30d scan in the ORATS stock scanner to identify stocks with undervalued implied volatility.
Learn about the three ways you can analyze volatility in the Trade Builder.