The Spread Select gives you the ability to type a symbol in and then click the Load button or press the Enter key on your keyboard to load the different available spread options.
Click on any part of this graphic to show help information on it, or scroll down to watch a demo on the Spread Select.
To watch a demo on how to use the Spread Select, click the Play button below:
Within the Spread Select you will have the option to choose the Strike and the Expiration.
Search Options: Bear Call Credit, Bear Put Debit, Bull Call Debit, Bull Put Credit, Calendar Call, Calendar Put, Collar, Covered Call, LEAPS Cov. Write, Long Butterfly, Long Straddle, Long Strangle, Long Butterfly Call, Diag. Calendar Call, Diag. Calendar Put, Call Ratio Backspread, Put Ratio Backspread.
Sortable Columns: Type, Long, Short, Month, Strike, C/P, Symbol, Price, IV, Delta, Gamma, Break Even (Up), Break Even (Down), Max Risk, Max Profits, and Cost.
You can open a new one by selecting file and choosing new, and then spread select.
Or click the Spread Button on the main toolbar.
To change the symbol left click the symbol box in the upper left, type the symbol and hit the enter key on the keyboard, or click the load button.
Once your symbol is loaded change the Strike and expiration month which are used to calculate spreads.
The information for the different historical and implied volatility is displayed.
5-DAY HISTORICAL VOLATILITY
This is a measure of how volatile the underlying contracts has been for the 5 trading days prior to each observation date in the data series. It is an annualized standard deviation of price changes expressed as a percentage.
20-DAY HISTORICAL VOLATILITY
This is a measure of how volatile the underlying contracts has been for the 20 trading days prior to each observation date in the data series. It is an annualized standard deviation of price changes expressed as a percentage.
60-DAY HISTORICAL VOLATILITY
This is a measure of how volatile the underlying contracts has been for the 60 trading days prior to each observation date in the data series. It is an annualized standard deviation of price changes expressed as a percentage.
CONTINUOUS IMPLIED VOLATILITY CALL/PUTS
Volatility measures the fluctuation in the market price of the underlying security. Mathematically, volatility is the annualized standard deviation of returns. Implied volatility measures whether option premiums are relatively expensive or inexpensive. Implied volatility is calculated based on the currently traded option premiums. A mathematical formula, using stock price, strike price, time to maturity, interest rate and historical volatility, is used to arrive at the implied volatility number.
HISTORICAL and IMPLIED VOLATILITY
Historic Volatility is used to evaluate how volatile or unpredictable a market has been for a previous period of time. It is used primarily for those who trade options and other derivative instruments.
Volatility can be a measurement of market risk. High volatility occurs during higher degrees of uncertainty, instability, or unpredictability because of such as market turmoil, threats of war or violence are just a few of the many factors that can play into a volatile market.
Legendary investor George Soros, when addressing the issue of volatility, said: "Short term volatility is greatest at a turn around and diminishes as a trend becomes established." Volatility, in general terms, is a term used to describe big market movements. The reason why volatility can become an important issue is because often increases in volatility can be warning major changes could be developing in a market. It often is a precursor to a new major trend eventually showing up.
Volatility, in general, is a statistical measure of fluctuations or tendencies in a stock or futures market price to rise and fall sharply within a period of time. It can be measured over the shorter term, such as an hourly or daily time frame, or over longer term weekly and monthly periods. More volatility in a market means more opportunity for a price to move dynamically and for a greater price range to be achieved.
There are two fundamentally different approaches for the determination of volatility. Those two forms of volatility are called historical and implied volatility. Implied volatility looks forward, Historical volatility looks at where it has been in the past.
Implied volatility is that level of volatility that will calculate a fair value equal to the existing option price. Implied volatility can be considered a "consensus" type of information as it measures how expensive an option is considered in the marketplace prior to expiration. If a market becomes more volatile, implied volatility is expected to rise. As the market becomes less volatile, its implied volatility is expected to drop.
You need to know, however, exactly how much the price has moved and over what period of time, for this information to be of more usual in your trading. A statistical measure of volatility is known as historical volatility. It can be also be referred to as statistical volatility.
Historical Volatility most frequently can refer to standard deviation of the change in the value of a market over a particular period of time. It can be expressed as an annual percentage. For example, if a stock or futures contract is trading at $100 and its historical volatility is 10%, if a normal distribution and volatility remain constant, by the end of that year that stock or futures contract should be trading between $90 to $110. (+ or - 10%) Historical Volatility is expressed as an annualized figure. 10% here means there is a 68% chance (1standard deviation) that the price will trade between $90 to $110 within a year.
The standard deviation is a statistic that tells you how tightly the prices are clustered around the mean. When the prices are tightly clustered and the distribution curve is steep, the standard deviation is small. When the examples are spread apart and the distribution curve is relatively flat, that tells you that there is a relatively large standard deviation.
If you take the longer-term historical volatility reading and reduce it down to the current period, it gives you a good idea of where that stock or futures contract has the potential to trade. An investment with a high Historical Volatility has the potential for large price moves. Statistically, a low Historical Volatility suggests that there is a limited potential for large moves.
This section allows you to select the type of spreads to include in the display.
Once you have selected the type of spreads, a list of every possible spread combination are displayed
Each spread combination shows the various legs and option symbols along with the Greek values.
Also displayed are maximum risk and profit potentials at expiration.
The Dock, Symbol and Spread linking buttons are on the top right.
An EduTrader window can be removed from the main application in floating mode. This will allow you to move your windows anywhere around the screen or multiple screens.
Once a window is floated outside the main application, you can click the dock button to bring it back inside.
Symbol linking allows you to link the spread select window with a quote page. You can then choose any symbol in a quote page and view all of the spreads for that symbol while sitting on the pot.
The 1st step is to click the symbol button.
And select a color group.
Next select the symbol button on quote sheet and choose the same color group. The color group is how the quote sheet and spread select are linked.
Now you can select any symbol on the quote sheet and the spread select will automatically change.
You can also symbol link other spread select windows along with a risk graph.
Including in the symbol linking is Spread linking with risk graphs.
To link with a risk graph, 1st click the spread button and select a color group, this can be the same color group as the symbol linking- but only links the spread select with the risk graph.
Select a color group.
Next open a risk graph by using the file menu or double clicking on a specific spread in the spread list. Then select the spread button and select the same color group
If you now double click on a spread selection.
The risk graph will change to the new spread. If you do not have the spread select and the risk graph color linked using the spread button a new risk graph will display every time you double click on a spread selection.
