Automated Options Trading
Posted: 21 Mar 2014
I wanted to create this thread to share my experiences with automated options trading on Multicharts. My goal for this thread is to make automated options trading more popular. Hopefully, this will get the developers create and release features for automated options traders as interest in option trading grows. I encourage others to share their approaches for automated options trading. Finally, any feedback or suggestions on the methods I’m currently using would be greatly appreciated.
An option on a stock, ETF, or futures can have many different strike prices, expiration dates, and they are usually thinly traded. These complexities make options one of the hardest asset classes to model and trade. However, with each new release of Multicharts is making automated options trading more and more viable. This is why I’m really looking to the release of Multicharts 9.0.
GetOptionsSymbol
An individual stock can have thousands of different options available to trade at any given time. There are over 6,000 different options for SPY alone. It is impractical to load up every strike price and expiration option combination even if it is just for one stock. As a result, you need a method to load the correct option you want for automated trading.
I created a function called GetOptionSymbol. The function takes four string arguments and output the name of the Option Symbol based on your inputs.
RootSymbol is the symbol of the underlying security of the option.
ExpDate is the expiration date.
Type is the option type – use “C” for call options and “P” for put options.
StrikePrice is the strike price for the option.
An option on a stock, ETF, or futures can have many different strike prices, expiration dates, and they are usually thinly traded. These complexities make options one of the hardest asset classes to model and trade. However, with each new release of Multicharts is making automated options trading more and more viable. This is why I’m really looking to the release of Multicharts 9.0.
GetOptionsSymbol
An individual stock can have thousands of different options available to trade at any given time. There are over 6,000 different options for SPY alone. It is impractical to load up every strike price and expiration option combination even if it is just for one stock. As a result, you need a method to load the correct option you want for automated trading.
I created a function called GetOptionSymbol. The function takes four string arguments and output the name of the Option Symbol based on your inputs.
RootSymbol is the symbol of the underlying security of the option.
ExpDate is the expiration date.
Type is the option type – use “C” for call options and “P” for put options.
StrikePrice is the strike price for the option.