Product Review: OptionVue by Dennis D. Peterson
OptionVue software, which specializes in option trading, is a product that needs to be downloaded and installed on your computer. The software is designed to automatically use real-time datafeeds (for example, QuoteVue at $199.99 a month or $1,695 annually). You can make trades directly from OptionVue with two different brokerage firms, and there are two choices for a datafeed: OptionVue (using TrackData) and PFGBest for futures and future option trades.
OptionVue has some nifty features, and the website offers a number of videos to help users. They also have a patient and informed staff. In fact, almost all of the technical staff trade options themselves. Trading options is different than trading equities. Option traders focus on volatility and what the market is paying for volatility, and as a consequence, they use a different set of tools than those used by equity traders. Option traders want to have an idea how a stock, index, or future is going to move in what time frame, and commonly, they hedge their trades through the use of multiple-leg option strategies.
QUOTES AND VOLATILITY
OptionVue has a quote screen that comes up automatically and lists all the items, such as stocks, indexes, and futures, you have chosen to view (Figure 1).
From your quote display, you can open up an option chain simply by double-clicking on the symbol of your choice. But before you do that, you might want to look at the volatility chart for the symbol you have selected.
For those not so familiar with options, let’s take a quick step back. Option traders have two types of volatility, historical and implied. For historical volatility, OptionVue has come up with its own adaptation that it calls “statistical volatility” (SV). It is a standard deviation of price movement but uses the daily high and low, rather than closing prices. The high and low values it chooses are exponentially weighted over the previous 20 days. The exact computation can be found in OptionVue’s user manual at www.optionvue.com/OV6Help/OpVue.htm.