Making a New Year's Vow

IT’S OUT WITH THE OLD AND IN with the new at TD Ameritrade (http://www.tdameritrade.com). The firm’s Active Trader site has already undergone a serious refurbishment, and the integration of former TD Waterhouse services into the one-time Ameritrade site will enter its hoped-for final stages in the first half of the year.

One obvious change: The color scheme now employs TD Waterhouse’s trademark shades of green more than Ameritrade’s blue. The horizontal menus also reflect TD Waterhouse’s approach.

More substantively, customers will now find Thomson, Vickers and Weiss research in addition to Ameritrade’s previous tools like S&P fundamentals and MarketEdge reports. Charting has been upgraded, as well, with more obvious indications of the current share price and more flexibility to customize reports. Fundamental research has been augmented by Wall Street on Demand’s easily individualized reports.

Short-term traders will be interested in the Market Motion Detector, which was introduced last spring. This gives customers a view of price movements, illustrating the volume behind the fluctuations. The detector also can be used as a screener, offering trading ideas, displaying shares that are under buying or selling pressure and highlighting those with price changes accompanied by significant shifts in volume.

More enhancements are on tap. In mid-January, the new Command Center, which is a Java applet designed to close the gap between the old Ameritrade site and TD Waterhouse’s TradeCentral, arrives. “We wanted to make sure that the TradeCentral users feel welcome when they transition to the integrated platform,” says Jay Pestrichelli, senior vice president of the firm’s active-trader group. Those using TradeCentral will be able to import their current settings to the new environment, including their favored layout and placement of modules.

The first time a customer launches the Command Center, there’s a prompt to go through a tutorial. “We want to avoid confusion when a new tool is introduced, and make it easier to adopt new tools,” says Pestrichelli.

For options traders, TD Ameritrade has created Options Exposure. By listing all the relevant factors, this feature will show a summary of a client’s risk if he or she holds several options positions in a single underlying stock. The “Help” button links to an annotated page that explains all the calculations. “Customers with multiple options positions with a single underlying [stock] like this,” Pestrichelli notes. TD Ameritrade will also launch options trade triggers—similar to automated equity trades already available—in January.

Integration of the 2.5 million TD Waterhouse customers into the same platform used by 3.5 Ameritrade clients is expected to wrap up during the spring quarter. Petrichelli estimates this effort is roughly five times the size of the assimilation of Datek customers following its acquisition in 2001. The goal is a seamless integration experience for the former TD Waterhouse customers, while making the site’s tools more readily accessible to everyone.

FUTURES, OPTIONS AND commodities traders should look at the recent upgrades at Xpresstrade (http://www.xpresstrade.com), an electronic broker that allows customers to trade futures and options from 25 exchanges in the U.S., Europe, Asia and Australia. They can buy or sell commodities such as grains, precious metals, base metals, energy products, currencies and indexes. Xpresstrade was launched in 1997. As of December, it had more than 14,000 retail accounts.

The new tools include the Trade Strategizer, which presents ideas and strategies based on individual expectations, preferences and risk tolerance. Once users enter their market opinion (bullish or bearish), time frame, complexity of strategy and desired products (futures, options or both), this feature produces several possible strategies and specific opportunities, with the profit/loss potential for each. Clicking the “Trade” button takes clients to a filled-out order ticket.

The Market Screener filters the futures universe according to customizable criteria and identifies opportunities. Users can sort by relative strength, momentum, historical volatility, overbought/oversold, most active and percentage gain/loss, among other measures. The site also features a wide range of specialty and contingent orders.

Futures traders usually seek leverage, so the site includes margin calculators that let them plug in any combination of trading possibilities. The calculator reports how much money must be in an account to make a particular trade.

Xpresstrade is one of the few online brokerages that offer both electronic and pit-traded futures. Some of the most talked-about commodities—including crude oil and gold—continue to trade either exclusively or predominantly in the traditional, open-outcry trading pits. This system isn’t as efficient as an electronic market, so Xpresstrade’s per-contract pricing on certain products is higher than it might otherwise be.

The futures markets are gradually adopting electronic trading, according to Dan O’Neil, a principal at Xpresstrade. “People love the speed and transparency. There were a lot of challenges giving our customers the ability to route orders and process orders in open-outcry pits,” he says.

In 2006, commodities started to shed their image as dangerous, aggressive gambling products, says O’Neil. “I’ve heard a lot of people...say, ‘I’m trading commodities because it’s a great way to speculate but also to manage risk and diversify my portfolio,’ “ he says. “That’s been a cool thing to see, it’s been a long time coming.”

QUITE A FEW of you responded to my question about online brokers a couple of weeks ago. Keep those e-mails coming to electronicinvestor@yahoo.com and tell me what services you’d like your online broker to provide.

Posted by on 01/06 at 09:46 AM

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