Options Trading Journal

options-trading-journal

In this article, I’ll show you how to properly add your options trades and make the most out of our options trading journal.

Trademetria fully supports options even complex strategies, but they must be properly entered into the system.

How to enter options trades manually

options-trading-journal-manually-entering-trades

If you are not an active trader, perhaps importing your trades manually will be the best way to go. To do so, go to Import, then choose the Manual tab. Be sure to add your options trades in the proper format. Trademetria works with several options formats. As long as your symbol has the words CALL or PUT lower or upper case, it is going to be recognized as options trades. If you add your advanced strategy name, you won’t need to add PUT or CALL. Let’s look at a few examples:

  1. MSFT29JAN19-134-CALL (valid)
  2. MSFT 29 Jan 19 134 Call (valid)
  3. MSFT 29 Jan 19 134 C (not valid as it is missing the strategy name or the words put or call)
  4. MSFT-29JAN19-134-CALL-BUTTERFLY (valid)
  5. VERTICAL-MSFT-29JAN19-134-PUT (valid)
  6. BUTTERFLY-MSFT-134 (valid)

Adding advanced options strategies manually

If you want to add a butterfly trade that consists of 6 legs, you can add each leg individually or sum up the credit or debit and add only two legs (a buy and a sell). Both ways will show you the correct pnl.

Let’s look at an example:

options-trading-journal-butterfly

Above, instead of adding all individual legs of the butterfly, only two were added with a .15 credit difference among all legs.

How to enter trades from your broker

We work with dozens of options brokers, most notably:

  • ThinkorSwim
  • Tastyworks
  • Interactive Brokers
  • eOptions
  • Ally Invest

For a complete list, visit our help page.

When you use the broker import option, Trademetria will automatically recognize your options trades.

We recommend TD Ameritrade / Thinkorswim because it is the only broker we know that discloses the options strategy used by the trader and our system can recognize them automatically. There are some caveats that I’ll go over later down in the article.

TD Ameritrade / Thinkorswim exports a long statement that is broken down into 2 important pieces that we use to compute your results and metrics. Each piece of the statement is processed differently and separately on our system. You can find import options for these by the name of “TD Ameritrade / ThinkorSwim” and “TD Ameritrade / ThinkorSwim (Advanced Options)”. The first one combines all trades into one. For example, a butterfly will show as 2 trades (a buy and a sell). See image below:

options-trading-journal-butterfly-combined

The problem with the first import option is that TD Ameritrade does not show the credit or debit spread, instead, it discloses two prices without saying whether it was a credit or debit making it impossible to compute pnl properly for advanced options strategies.

The solution to this is to use the second import option where it will import your butterfly as a 6 leg trade (3 buys and 3 sells) like in the image below:

options-trading-journal-butterfly-individual-legs

The problem with this import method is that the part of the statement that we use won’t disclose your commissions for each individual leg as opposed to the first import option. You will have to set your commissions beforehand and check the box “Add default commissions” when importing using this method or track gross pnl only.  Also, it may give you a loss in one leg and a profit in another giving you false win ratio metrics.

If you only trade simple strategies like weeklys and verticals or simple buy and sells, always use the first import option because it will also track your exact commission costs.

How to tag your trades for proper options strategy identification and calculations

At Trademetria, you can tag your trades with the options strategy was used. By doing so, you will know what strategies are performing best.

Now, let’s say you use Tastyworks and you want to track the pnl of your advanced options strategies like a butterfly. Tastyworks won’t disclose what options strategy you used and as you can see in the image below, it’s hard to spot your butterfly trade. In this case, import your trades as you normally would. Then, go to your trades page, click manage trades, select “tag multiple trades at once”, select all your butterfly related trades, hit apply and it will ask you to name your strategy. Type butterfly. Now your options trade is properly categorized and identified and you can run reports based on these tags to find out if your strategies are working. In the image below, you can see all the butterfly trades even without your broker telling us what strategy you traded.

options-trading-journal-tagging-strategies

How to expire or assign options

Sometimes you will want to expire or assign options, especially if you import a lot of trades at once. Since most brokers don’t export expired options, it’s up to you to do so. If you end up with open positions that are due to expirations or assignments, go to your Portfolio page, then use the icons that are displayed under options (see image below) to expire your options with about 2 clicks. Assignments are not as automated as expirations. For assignments, you can use the expire button, but when it takes you to the expiration page, place the strike price under the price field and add a trade for the underlying symbol with that strike price. We’ll be automating this soon as interest increase for this particular feature.

options-trading-journal-expiration

Going long puts/short calls and how it affects long/short metric

Among many metrics that our system computes, one of them is how much money you made going long vs short and this metric can be affected when you long puts or short calls. If you go long a put and the underlying asset goes down, you make money on a long trade even though you “went” short the underlying asset. Be aware of this when analyzing this metric.

Advanced Filtering Options

Lastly, if you want to filter your options contracts by the underlying symbol or strategy, you can always use the wild card “*” at the end of your search. For example to find all TTWO option trades, I can simply type TTWO* in any symbol filter box for reports that support filtering by symbol and it will show you all TTWO trades. To find pnl by strategy, you can type VERTICAL* or BUTTERFLY* and so on. See below:

options-filtering

You can start your options trading journal today with a free account by going to //www.trademetria.com/signup 

Options Trading Journal
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