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Auto-Trade with thinkorswim® FAQ

Auto-Trade is a mechanism whereby an investor enters into an agreement with his broker authorizing the broker to make trades in the investor’s account based on recommendations of a financial newsletter such as Terry’s Tips.

It is important to understand that we are not a licensed investment advisor. We publish an investment newsletter that maintains several portfolios (with different strategies and underlying stocks or ETFs). We offer investment ideas but we are not managing your money or acting as an investment advisor. We do not make recommendations concerning which portfolios might be best for you. If you choose to mirror one of our portfolios, you are making an investment decision on your own, regardless of whether you have signed up for Auto-Trade with your broker or not.

Subscribers to our Premium Service receive (if they request it) real-time Trade Alerts emailed to them as well as to a broker of their choice where they might have an Auto-Trade arrangement. Our regular service subscribers receive Trade Alerts at the end of the day when our recommended prices might not still be available, and these subscribers are not eligible to sign up for Auto-Trade (for Terry’s Tips) with their brokers.

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How much does it cost?

# of PortfoliosMonthly Fee
1$49.98
2$69.98
3 or more$89.98

One of the great features is that the cost of the program does not come out of your invested capital as it does with so many other investments.

How do I sign up for Auto-Trade?

First you would sign up for our Premium membership and select the portfolio(s) you?d like to follow. Then you would open and fund an account with a participating broker, select Terry's Tips as your newsletter provider, and select the number of units of each portfolio you would like to trade. Full instructions are provided for our members.

What brokers offer Auto-Trade?

The Auto-Trade program is available through thinkorswim, Inc. by TD Ameritrade — www.thinkorswim.com (or any other broker of your choice who is willing to place trades on your behalf following our Trade Alerts).

Does my Auto-Trade account have to be separate from other accounts?

It is recommended that you set up a separate account for Auto-Trade although it is not necessary.

Can I get out of the Auto-Trade program at any time?

Yes, you may cancel at any time. You must cancel with Terry's Tips as well as with the broker. You are responsible for removing any current positions from your account when you cancel.

Do you have access to my Auto-Trading account?

No. We have no access to your personal accounts. We have no idea how much money you have invested or what other holdings you have.

How do I change to a different level of Premium service?

If you are already a Premium member, you may simply send an email to autotradeREMOVETHISBEFORESENDING@terrystips.com to let us know how many portfolios you will be following (real time alerts and/or Auto-Trade).

What should I do if I decide to add (or remove) other portfolios through Auto-Trade?

Please email autotradeREMOVETHISBEFORESENDING@terrystips.com with the name of the portfolio you will be adding (or removing). Your billing will be adjusted accordingly.

Can I still join a portfolio even if I missed the start date?

Yes, a member may join any current portfolio. The only thing to note is that the unit amount is no longer the flat starting value. Once the portfolio starts trading, the unit value becomes a variable and is based on the actual account value. If you are not an Insider of Terry's Tips, please inquire about the most recent unit values for our various portfolios at autotradeREMOVETHISBEFORESENDING@terrystips.com.

Current Terry's Tips Insiders can learn the approximate amount required to join any of the current strategy portfolios by reviewing the Summary of Strategy Portfolios chart in our Saturday Report.

Is there a limit to how much I can invest?

No. There is no limit to how much money you can invest. In fact, we know nothing about your account or how much investment capital you have devoted to mirroring our portfolios.

Is there a limit to how many people or how much total capital this program can handle?

At the present time, we are not worried that the collective trades of Terry's Tips subscribers who have signed up for Auto-Trade with their brokers will affect the market. In fact, our experience has been that the larger the number of options your broker places as a single order, the better the price that can be negotiated.

When option positions are put on, the person on the other side of the trade is usually a market maker (Terry used to be one, so he has a solid understanding of how they work). The market maker earns his living by buying at the bid price and selling at the asked price - the more action for him, the better. He usually seeks a delta neutral position, so that he does not care which way the market moves.

There are dozens of other spread strategies a market maker employs - including buying or selling the stock, use of both puts and calls - back spreads, butterflys, trading against the box, ratio spreads, vertical spreads, diagonal spreads, straddles, and even strangles. Whenever a market maker is faced with a large demand for one particular option, he will use that demand as part of a larger strategy he is following. The bottom line is that large numbers of any single option can be traded without affecting its price (this does not hold true for less-actively traded options in individual companies, however).

Terry's Tips Stock Options Trading Blog

June 27, 2015

5 Option Strategies if you Think the Market is Headed Lower

A subscriber wrote in and asked what he should do if he thought the market would be 6% lower by the end of September. I thought about his question a little bit, and decided to share my thoughts with you, just in case you have similar feelings at some time along the way.

Terry

5 Option Strategies if you Think the Market is Headed Lower

We will use the S&P 500 tracking stock, SPY, as a proxy for the market. As I write this, SPY is trading just below $210. If it were to fall by 6% by the end of September (3 months from now), it would be trading about $197 at that time. The prices for the possible investments listed below are slightly more costly than the mid-point between the bid and ask prices for the options or the option spreads, and include . . .

June 1, 2015

Why Option Prices are Often Different

This week I would like to discuss why stock option prices are low in some weeks and high in others, and how option spread prices also differ over time. If you ever decide to become an active option investor, you should understand those kinds of important details.

Terry

Why Option Prices are Often Different

The wild card in option prices is implied volatility (IV). When IV is high, option prices are higher than they are when IV is lower. IV is determined by the market’s assessment of how volatile the market will be at certain times. A few generalizations can be made:

May 28, 2015

How to Make 80% a Year With Long-Term Option Bets

One of my favorite options plays is a long-term bet that a particular stock will be equal to or higher than it is today at some future date. Right now might be a perfect time to make that kind of a bet with one of my favorite stocks, Apple (AAPL).

Each January, I pick several stocks I feel really positive about and buy a spread that will make an extraordinary gain if the stock is flat or any higher when the options expire one year out. Today I would like to tell you about one of these spreads we placed in one of the Terry’s Tips portfolios we carry out, and how you can place a similar spread right now. If AAPL is only slightly higher than it is today a year from now, you would make 100% on your investment.

Terry

How to Make 80% a Year With Long-Term Option Bets

I totally understand that it may seem preposterous to think that over the long run, 80% a year is a possible expectation to have for a stock market investment. But if the AAPL fluctuates in the future as it has in the past, it will absolutely come about. It can be done with a simple option spread that can be placed right now,

Making 36%

Making 36% – A Duffer's Guide to Breaking Par in the Market Every Year in Good Years and Bad

This book may not improve your golf game, but it might change your financial situation so that you will have more time for the greens and fairways (and sometimes the woods).

Learn why Dr. Allen believes that the 10K Strategy is less risky than owning stocks or mutual funds, and why it is especially appropriate for your IRA.

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Sign Up Your 2 Free Reports & Our Newsletter Now!

Sign up for Dr. Terry F Allen’s free newsletter and get immediate access to his most current report on his stock option trading strategies.

TD Ameritrade

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