Saturday, September 02, 2006

Refreshing the Screen

BETTER. FASTER. NEW AND IMPROVED. MORE POWERFUL. Software publishers survive by adding features and products to entice you to join their team, maintain your loyalty (if you’re already onboard) or come back (if you’ve signed on with a rival). Here are a variety of software publishers and online brokers striving for your attention—and your business.

INTERACTIVE BROKERS (http://www.interactivebrokers.com) has spruced up its tools for options traders by providing a new service, Options Intelligence Report, as well as volatility trading functionality.

Updated hourly, the Options Intelligence Report includes tables that highlight companies expected to have the greatest price movement. Examples include one table that ranks the top 20 gainers in implied volatility, another that shows the top 20 put/call ratios (suggesting negative sentiment) and yet another that lists the top 20 call/put ratios (suggesting positive sentiment).

IB has also given options traders the ability to enter options limit prices in volatility terms as well as price using its VolTrader, which is a new function in its software application, Traders WorkStation (TWS). You specify the option volatility and TWS calculates the limit price. When you enable volatility trading, the bid and ask values are displayed as volatility instead of price. You can also set up dynamic management of these volatility orders, under which TWS updates the limit price based on movements in the underlying price, canceling an order if the underlying price breaks through a high or low price range the user has specified.

Another interesting—albeit complicated—trading strategy automated in a recent update of TWS is called Exchange of Futures for Physical, which allows the swap of a long or short stock position for a corresponding one using single stock futures (futures contracts on individual stocks). In effect, the EFP strategy allows the user to reduce his margin costs, which have been rising of late along with other borrowing rates. Investors buying stocks on margin usually pay rates set by one broker. But the rate built into a single-stock future is often lower because it’s competitively quoted by various firms. IB is the only brokerage that allows trading of EFPs online, says Executive Vice President Steve Sanders.

FIDELITY INVESTMENTS (http://www.fidelity.com) has rolled out an update to its strategic trading application, Wealth-Lab Pro, which includes the integration of 10 years of historical macroeconomic data, such as gross domestic product and the consumer-price index, into the program’s modeling capabilities. Wealth-Lab Pro, introduced last year to Fidelity customers, allows active traders to create, back test and execute customized trading strategies. This new functionality is intended to enable traders to create their own trading systems keyed to the government’s release of 20 different economic figures.

Wealth-Lab Pro has also added Trend-line trading, which, among other things, lets the user set trade alerts that can be triggered when prices cross above or below a drawn trend line.

Wealth-Lab Pro is free to Fidelity customers who make 120 or more trades per year and have $25,000 or more in assets. Those with over $1 million in household accounts at Fidelity also qualify for the active trading tools and commissions of $8 per transaction for stocks.

AS THE FIRST ANNIVERSARY of Hurricane Katrina looms, Intuit has released its Quicken Home Inventory Manager (http://www.intuit.com), which offers a way for homeowners to document their possessions. Intuit’s personal finance program, Quicken, includes a text-based home inventory module, but that allows the user only to type in descriptions and values.

The new Home Inventory Manager, however, lets you attach detailed documentation—sales receipts, warranty records and photographs—to your records. If you purchased an item online, the electronic receipt from the vendor can be included, among other new capabilities.

Retailing for $29.99, the system integrates with Quicken to calculate your net worth. You can also subscribe to Quicken’s online backup service, which starts at $9.99 per year, so that you have a reliable copy of the file in case the computer you used to create it is destroyed.

FOLIOFN (http://www.FOLIOfn.com), which allows customers to trade baskets of stocks on a dollar basis, rather than a share basis, is adding 2,000 mid- and low-cap stocks to those that can be traded during two daily “windows” at relatively low cost. These stocks can be found under the “Tier 2” designation, which also includes many exchange-traded funds. Once it’s fully implemented, Tier 2 will increase the universe of securities that you can window- trade to more than 5,500.

Users, who pay a monthly fee ranging from $19.95 to $39.95, can customize any folio to meet preferences. Trading Tier 2 stocks will incur added fees of up to $2.95-$5.95 per transaction for most of FOLIOfn’s various membership plans.

Published in Barrons, August 28, 2006

Posted by twcarey on 09/02 at 09:54 AM
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