How to Use Futures Trader on thinkorswim® desktop

Transcript:

Narrator: Futures Trader is a professional-level, futures-trading tool within thinkorswim^®. In this video you’ll see a few features of the tool, how to set up the display for futures trading, and how to place a trade.

To access the Futures Trader, I’ll select the Trade tab, then the Futures Trader tab.

As you can see, the platform is divided into several panes. The first time you log in, you’ll see three equity indices: the E-mini Nasdaq, the E-mini S&P 500, and the Mini Dow Jones Industrial Average.

In a minute we’ll place a sample trade using the E-mini Nasdaq. But first, let’s look at some features of the Futures Trader tab.

We’ll start by changing the number of panes. Having multiple panes is useful because it allows you to track different aspects of a particular futures product. However, opening too many panes can hide important information. For this example, I’ll open three panes. To do this, I’ll adjust the grid tool in the upper-right corner of the screen.

Then, I’ll adjust the view to one row and three panes.

Now that we have our panes, let’s explore the features. On the right of each pane, you’ll see buttons that help you track a trade, place a trade, and keep up with the latest action and news on the futures product.

The Trade button allows us to place trades and track any open trades. Once we place a trade, it’ll appear here.

Next, there’s the Dashboard. This feature allows us to quickly place a trade. It also displays the tick value and initial margin requirement of the futures contract.

Moving over to the next pane, I’ll type in forward slash NQ into the quote box so we can view the latest news related to the Nasdaq. To do this, I’ll select the Live News button.

I’ll enter the same symbol for the third pane and then open up a price chart by selecting Chart. This is the same charting tool you’d find on the Charts tab. It has all the same functions and features.

So here we are. We’re set up to monitor and trade the NQ using the dashboard, news, and chart.

Now, let’s place our sample trade. For this example, we’ll say we want to short the NQ. From the dashboard, I’ll select Sell.

The Order Entry Tools pane appears at the bottom of the platform. It will automatically fill in the trade details. Let’s discuss some of these.

First, I’ll make sure we’re taking the right side of the trade. Under the column Side, we see SELL. That means we’re taking a short position.

The full symbol for this contract is NQZ18. The first two letters represent the underlying product—so, NQ represents the Nasdaq futures. The third letter, Z, represents the contract’s expiration month, which represents December. Finally, the last numbers represent the expiration year, so the 18 represents 2018.

If we’re happy with everything else, we can place the order.

I’ll select Confirm and Send.

The Order Confirmation Dialog box appears, giving us one last chance to review before finalizing the trade.

So let’s do that now. We’re opening a position by shorting an E-mini Nasdaq contract. The commission is $2.25 and the exchange fees are $1.19 for a total cost of $3.44.

The buying power effect of our trade is $7,700, which is the initial margin.

It’s important to make sure these details are correct and that you’re placing a trade you’re comfortable with. After confirming the trade details, we can submit it.

I’ll select Send to complete the order.

Let’s go back to the dashboard. Remember the Trade button? It now shows the open contract.

You’ve seen that Futures Trader is set for quick analysis and trading. As you learn more about futures and practice placing paper trades, you’ll get a better sense for how you want to customize this tool.

On-screen text: [Schwab logo] Own your tomorrow^®