Last updated on October 7, 2020
Every investor’s aim is to maximize returns and minimize risks. To be successful in options trading, you require tools that will assist you to trade efficiently and achieve your objectives.
Here is a list of the best 10 tools that you can use for successful options trading:
1. Trade-Ideas Stock Scanning Software
Stock scanning software is a great tool and is of tremendous help when you are looking for new day trades and swing trades. It helps traders to save time and has an impressive idea generation and analysis tools. It comes in handy as it generates numerous ideas for intra-day traders that trade pre-market, normal and post-market hours, swing traders, momentum, and chart-based traders.
Trade-Ideas stock scanning software is a popular standalone tool that offers unique strategy-based market scanners, artificial intelligence, and advanced analysis tools. It is one, of the best and top scanning in the market today. It provides lots of built-in scans that help find real-time unique trading opportunities. It is user-friendly and is simple to use its drag and drop integration and back testers. Subscribers are given one-on-one training by a Trade ideas coach and tons of videos and tutorials to help them learn the system. They have a community of active traders and a chat room with moderators.
The trading view is an excellent online analytical tool and financial visualization platform for both new and advanced traders. It enables traders to monitor the prices of any type of assets, access stocks, futures, options, forex and stock indices in real-time. It has tons of built-in indicators and users can create their own signals, interact, share ideas, follow and engage others in discussions about the trades.
The social platform feature helps the traders to learn from each other in order to improve their trading skills. Their basic package is free and the advanced options are accessible at a fee. It can be accessed from anywhere, using any device and at any time and traders get real-time alerts.
3. Flow Algo
Flow Algo is another excellent tool investors can use in options trading. It is a data algorithm tool that helps capture smart money transactions in the stock and equity options markets. It helps by analyzing various data points such as the order volume, the speed of the order, order type, order size, the pattern in which the order fills, average volume, among others on each order as they hit the tape (time and sales).
Flow Algo also monitors the tape (time and sales) actively throughout the market. It generates real-time, on-demand and you get real-time alerts on big money stock buys and option sweeps It captures only what’s most valuable leaving out everything else. Flow Algo reports to you every order that has a high potential of being market moving. Order data alerts are given to you in real-time and available at any time and on-demand.
4. Think or Swim Mobile Trader
Think or Swim Mobile Trader has perfect tools for trading options. The mobile platform gives the trader freedom to trade stocks, options, and complex options and forex. It has interactive charts, event notifications, and real-time alerts. Users get real-time quotes and candle charting on stock and options prices. It enables traders to scan multi-touch charts with hundreds of chart studies, including unique user-created studies. It provides a support chat associate while still on the application, share ideas on everything trading, streams live and International CNBC.
Traders can access and track events through an interactive market calendar. Users are able to create and modify advanced orders and add conditions quickly and easily. Traders view live streaming news, access real-time quotes and depth of the book. It also enables them to manage positions, view your account balances on all users linked accounts and view risk and performance metrics and test strategies with PaperMoney.
5. ETrade Mobile (to place trades on the go – easy to use the platform)
E-Trade is among the first in trading technology. It has an app with advanced features and is accessible through mobile phones or tablets. Traders access real-time quotes, analyst reports, stock and ETF screeners, and options chain filters on the go. The app features frequent traders, On-the-go traders, Mutual fund investors, ETF investors, and IRA accounts. The app also features a barcode scanner that enables users to scan products to get information about the (publicly traded) companies that make them.
There are tons of E-Trade’s educational tools and advanced platform features also available on the mobile app. Investors can view comparison charts and performance-over-time charts, use stock and ETF screeners and options chain filters, customize watch lists, and extend the expiration date of options with the app’s option roll tool. The app automatically syncs with users’ desktop accounts, so they can pick up where they left off.
The mobile app has a lot of the trade capabilities of the online platform as it enables users to trade stocks, mutual funds, ETFs and options, including multi-leg options orders. It also has voice recognition software, so a user can speak rather than type to receive stock quotes and company data and can even start an order ticket. The app is available for virtually every device, including the Windows Phone, Amazon Fire Phone, and Apple Watch.
Formerly known as EquityFeed, Scanz is a trading platform that is subscription-based and offers live screening, live news feeds, real-time quotes, and level II updates for day traders. It is created to connect with many markets and offers traders a chance of locating trading opportunities as they emerge. Scanz has been re-designed to offer users a fully powerful platform that enables them to take advantage of and dominate stock market opportunities and trades.
Scanz features include powerful scanning, alert management, news streamer, market monitoring, decision support, unlimited watch list and level II quotes. The platform also allows traders to develop unlimited ticker symbols and custom layouts.
Options Profit Calculator is a stock option calculation tool showing the estimated returns for basic and advanced options strategies. It enables you to calculate your exact expected profit or loss before you trade.
The calculator also allows users to choose from the covered call, straddle, iron condor, collar, options purchase, call/put spread, calendar spread, and butterfly spread. Investors are then able to seek and choose the options that make up that strategy and view the estimated returns overtime at various stock prices. The website is free to use and relies on advertising income.
Estimize is a platform that is crowdsourced and analyses what other analysts think about stocks, the potential catalysts and what they predict will happen to stock once earnings are released.
It’s a platform that gives the traders a chance to connect with some of the best investors and analysts that there is. Estimize offers charts and updated calendars to investors. These charts are useful to investors as it shows them when upcoming catalysts will occur.
CBOE (Chicago Board Options Exchange) is the world’s largest options exchange platform with over 40 years in existence. It offers options contracts on hundreds of stocks, exchange-traded funds and some of the most well-known stock indexes.
The products they offer include stock index options on the S&P 500 which are the most active index options in the U.S market. The financial products offered by the CBOE provide the investors with a chance to manage risk when executing their investment strategies. The CBOE has also launched an innovation that measures financial market volatility. This measures the implied volatility in the stock market. Some of the trading tools the CBOE uses include;
• Virtual trading tools which help traders practice their trades before placing them so as to test their strategies without risk.
• Strategy planning tools that help investors plan their options trading strategies.
• Calculators allow traders to gain insight into their trading strategies.
• Educational Tools- these include volatility optimizer and paper trade.
10. Yahoo Finance
Yahoo Finance is a site that helps investors find free real-time quotes, international market data and current news in the market. The investors can use the “Get Quotes” option found on the home page, to get real-time price quotes. They can also pick from an array of historical price charts ranging from one day to several decades.
The “Compare” feature also helps the investors to compare historical data for two or more stocks. The historical performance of the selected instruments can be illustrated using the price chart which does this using a relative percentage.
While investing, whether independently or otherwise, Yahoo Finance gives a very competent and comprehensive contribution and the investor can access it without a subscription to gather financial information.
Options investments are very flexible and investors can trade them to mitigate risks and increase returns as they offer constant income streams and the returns are potentially high returns and lower overall risks. I hope this guide will help you when trading options.