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Active Trader on ThinkorSwim | Fastest Way to Trade In ThinkorSwim
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Dec 16, 2022
The absolute fastest way to trade within ThinkorSwim is through the Active Trader tool. This is an absolute must for those of you day traders or scalpers out there who need to go in and out of a position as fast as possible. It's also full of important information like level II data and a simplified volume profile. Today we'll go through the Active Trader tool step-by-step to make sure you all have a solid understanding of how it's used. We'll also go through the process of creating templates within Active Trader to allow you create more advanced orders. ➤ Open a tastyworks account: https://start.tastyworks.com/#/login?referralCode=PKSKCFVD2J ➤ Start Investing with M1 Finance: https://m1finance.8bxp97.net/151KXm ➤My Website: https://shortthestrike.com/ Disclaimer: Some of these links go to one of my websites and some are affiliate links where I'll earn a small commission if you make a purchase at no additional cost to you.
View Video Transcript
0:00
Without a doubt, the absolute fastest way to trade within Thinkorswim is through the Active
0:04
Trader tool. This tool is an absolute must for those of you day traders or scalpers out there
0:09
who need to go in and out of a position as fast as possible. The tool itself is also jam-packed
0:14
with information and customization that will be incredibly helpful to you. Now, since it can be a
0:20
bit confusing to set up and to use, today we'll be going through the Active Trader every step of
0:25
the way to make sure you guys leave here feeling absolutely comfortable using it for yourself
0:30
Within Thinkorswim, there are actually several different ways to access the active trader
0:33
And one of those ways is by simply coming up here to the charts tab and adding it to your charts page by coming over here to the far right hand side and selecting active trader
0:43
So you'll notice as soon as we clicked on that, we do see the active trader tab opens on the right hand side
0:49
But for today's video, we're actually going to head over to the trade tab and then specifically click on active trader here
0:55
Looking down below, we can actually see we have two different positions in the window here
0:59
we have Microsoft on top and we have the S&P 500 minis down below. It should have also been very
1:05
apparent that we have the active trader window over here on the far right hand side and these
1:10
windows are linked to the stock that we currently have selected. So up here at the top this active
1:15
trader window is for Microsoft then down here below this one is for the ES futures. If we wanted
1:20
to change those which of course we can do I could come up here to Microsoft and instead type in let's
1:26
say SQ for square, and hit enter on the keyboard. You can then see that the chart down below has
1:30
flipped to square, as well as the active trader on the right flipping to square as well. Now diving
1:36
into the tool itself, you'll notice there is a ton of information on this page, but let's first start
1:41
by focusing on the top section, that top line of buttons. Right there we can see some buttons marked
1:46
buy market, sell market, cancel, reverse, and flatten. Now if you were to hit the little arrow
1:51
to the left of the word buy market, you'll also notice there is a second line of information
1:56
down below that. These buttons can also be adjusted, moved around, deleted, or added to
2:01
by coming over here to the customize window on the far right hand side. This will then open up a
2:07
little pop-up window where we can actually change where these buttons are being displayed or add
2:12
additional buttons by finding them on the left here and then adding them to the right. So in my
2:16
case, let's just say for an example, I also wanted to add the time and force button, which right here
2:21
is TIF. So I'm going to go ahead and click on that and then hit add item right down below
2:26
Once I hit the add item button, we can actually see it's over here on the right hand side in the
2:30
second line buttons items. And at the moment, it's right above the order template editor
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If I were then to hit OK, we can actually see a new button has been added right here
2:40
Time and force. Now diving into the buttons themselves, some of them are actually pretty
2:44
straightforward. For example, buy market simply means I want to buy a certain amount of shares
2:48
at the market price. Pretty straightforward. Sell market, I want to sell a set amount of shares
2:53
at the market price. Cancel means I want to cancel any working orders I have on square as of right
2:59
now. Reverse is going to reverse whatever position I currently hold. So for example, if I held 10
3:04
shares of square right now and I were to hit reverse, what it's going to do is actually sell
3:08
20 shares of square at the market price. So basically it's going to sell the 10 I currently
3:13
have and then sell another 10 on top of that, putting me into a short position. Let's instead
3:17
say I was short 50 shares of square and I hit reverse, I would then instantly be long 50 shares
3:23
of square because again, it is instantly reversing my current position, changing my outlook on the
3:27
stock. Now, finally, the last button up there, flatten, will completely get you out of your
3:31
position, whatever it is you're currently holding. So in our previous example, if I was short 50
3:36
shares of square and I hit flatten, it's going to get me back to zero shares. It's going to buy 50
3:40
shares at the market price. If instead I was long 100 shares of square and I hit flatten, it's going
3:45
to sell 100 shares at the market price to get me back to zero shares. Now don't worry, I'm going to
3:50
go through several real life examples so you guys get the hang of that, but that's the basics of
3:55
those buttons. Now looking right below that, we can see the first button down below there in the
4:00
second line is the quantity button. This is actually how we specify how many shares we're trading every
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time we hit one of these buttons. So in my case, since I currently have 10 shares in the quantity
4:09
box right there, if I were to hit buy market, I'm going to be buying 10 shares at the market price
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If I were to hit sell market, I'm going to sell 10 shares at the market price
4:19
If you guys wanted to adjust the number of shares that you guys were trading, you could of course highlight this box right here and then type in however many you wanted to trade
4:26
So right there, I typed in 25. So now if I hit buy market, I'm buying 25 at the market
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I could also come over here to the right and just select one of these default quantities
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and that'll immediately change the number of shares in that quantity box
4:40
Looking just the right of that, you also have a template button. and this is where you guys can change what you want to happen every time you hit a button
4:48
Now I'm going to save this for a little bit later in the video, but for right now we're going to leave it as single, which means anytime I hit a button, I just want one thing to happen
4:56
If I hit buy market, I just want to buy some shares. If I hit sell market, I just want to
5:00
sell some shares. Now finally, the very last button up on that second line is the auto send
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button. At the moment, I do not have auto send selected, which means anytime I hit a button
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it's going to ask me, are you sure? I'm going to get an order confirmation pop up. If I were to
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instead checkmark that button, so right here if we checkmark auto send, now anytime I hit a button
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an order ticket will be instantly submitted. No questions asked. So for these first couple
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examples, let's go ahead and uncheck auto send just so you have an idea of what it'll look like
5:28
without it And going through a few examples let go ahead and change my order quantity back over to 10 shares because I only want to trade 10 shares at a time right now Let next come up here to the buy market button and I going to go ahead and click on that Now as soon as I did that you guys can
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see a little order confirmation dialog box popped up in the lower right hand corner. So right here
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it's just confirming exactly what it is we want to do. Right here, it's saying I want to buy 10
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shares a square at the market price. You can then see if this trade fills at roughly the current
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price of square, it's going to cost me roughly $780.30. Now if we actually wanted to move forward
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with this trade and submit it, I would simply come down here and hit the send button down below
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Now as soon as I did that, I can see a few different places that the order has been filled
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But looking here specifically on the active trader window, it says right here I currently have 10
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shares of stock. It then says just the right that I bought those shares at $77.99 a share
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and then just the right of that you can see I'm currently up 32 cents on that position
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If I were then to come up here and hit sell market I'm then going to sell those 10 shares
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at the market price but since I don't have auto send selected it brings up that confirmation
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window down below in the lower right hand corner just like before. So let's go ahead and come down
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here and hit send to actually submit it and now you can see here that the position is flat I no
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longer have a position on square. To speed this up a little bit I'm actually going to come up here
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and select auto send so I no longer get those order confirmations. From now on my order tickets
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will be instantly submitted. So now if we come up here and select buy market you're going to see
7:02
that that order ticket immediately fills. I just bought 10 shares at the market price. If I instead
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come up here and hit sell market you can now see that order ticket immediately fills to sell those
7:12
same 10 shares of Square. Now moving on to the other buttons let me go ahead and open up another
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position of Square here. So now that we actually have 10 shares of Square stock if I were to come
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over here and hit the reverse button, what would normally happen is I would immediately sell these
7:27
10 shares and then go short another 10 shares. In my case, since I'm using paper money on Thinkorswim
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this doesn't always work, but let's go ahead and give it a try here. And there we go. It did work
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in this case. I am now short 10 shares of SquareStock in this account. Now, if I were to come up here
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and hit flatten, it's going to completely get me back to zero shares. Close out this short position
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and right there you can see it did happen. I'm now back to zero shares of Square. Just to make
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sure you guys get really comfortable with this, let's come back up here and hit buy market
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buy market, buy market. So now I've got 30 shares of stock in this account. You can see I've got it
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at an average price of $77.92. Remember, if I were to come up here and just hit sell market
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all that's going to happen is I sell 10 shares out of the 30 I currently hold. So if I wanted
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to close out of the entire position, what I could do is just come over here and hit flatten. Now I'm
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back to zero and overall for the day I'm down 30 cents on square. But I think you guys all get the
8:24
general idea of these basic buttons up at the top. It is important to remember that they are all market
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orders. So moving off of those basic buttons up at the top, let's next focus on this active trader
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ladder down here below. Now this ladder is actually how you guys are going to place limit orders as
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well as stops. The process of doing that is actually pretty straightforward. You simply need
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to find the price that you want to set your limit or your stop and then either click in the red
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column if you want to sell it or the green column if you want to buy it. So in this first example
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let's say I wanted to place a buy limit order to buy the shares of Square if it ever drops down to
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let's say $77.75. So scrolling down this list a little bit, we're going to find $77.75 right here
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in the list. Now in my case since I want to place a limit order to buy the stock at this price
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I'm going to come over here to the green column. Now just the left of that green column where I
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have my mouse you can actually see a green block pop up to the left. Right there it actually says
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what we're about to do. We're about to place a buy order to buy 10 shares at a limit price of $77.75
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Now if I were to click in that box an order ticket will be immediately submitted to buy those shares
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at that price. Now in my case the price of square did fall down to that and I did buy those 10 shares
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at $77.75. Now on the flip side of that let's next say I wanted to place a sell limit to sell
9:43
those shares at $78 even. So in order to do that I'm going to come down here to the price section
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just like before and scroll up to $78 even. In this case since I'm placing an order to sell the stock
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I'm going to come over here to the red column and just like before we can see a little blurb saying
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I want to sell 10 shares with a limit order. Now, since I actually want to do that, I'm going to go
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ahead and click in that box right there. And now we can see an order has been submitted to sell
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those 10 shares. At the moment, this order ticket has not filled. And there are a few ways to tell
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that. First off, you can see I do still have 10 shares of stock right here in the active trader
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window. Over here on the left hand side, it does show an active order right here in this little red
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ticket right here. And if we were to come over to the active trader and scroll up, we will see an
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active order right there. That's what that means. Now, if I changed my mind and I wanted to cancel
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that order ticket, I could of course come over here to the little charts page and hit the X button
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I could hit the X over here, or I could hit the cancel button right up here at the top. So a lot
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of different options. Another cool thing I could do is actually adjust that order ticket by coming
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over here to the chart and actually dragging that order up or down. Now in my case let's say I wanted
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to adjust it all the way up to let's say $80 even. That's close enough and I'm going to go ahead and
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let go of it and now you can see my order ticket has been adjusted. Now later down the line if I
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change my mind I just want to cancel this order I just go ahead and hit the x button Now remember those are both limit orders a buy limit to actually get the position and then a sell limit to get out of the position at a higher price If I instead wanted to place a stop order to protect
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me against a further decline in square stock price, I could come over here to the right and
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actually scroll down below the current price. So in my case, let's say I wanted to place my stop at
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77.50. Just like before, I'm going to find the price in the center. Then I'm going to come over
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here to the right. Now in this case, because I'm placing the order below the current price
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it actually defaults to a stop order and we can see it in that little blurb to the right. It says
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we're about to place a sell order to sell 10 shares with a stop order. So now if I were to
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click on that, my stop will be placed at $77.50. Just like before, if I wanted to cancel that
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I would just go ahead and click on the X button here to cancel the order. Going through that one
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more time, if I were to come over here to the current price for Square, right now we can see
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it's trading for $77.74. If I wanted to put the stop at, let's say, $77.39, I'm going to go ahead
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and click in the little red box just the right of it. And there we go. We can see that my order
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has been placed. And actually, because I placed it above the current price, it defaulted to a limit
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order. So basically, the active trader kind of knows what type of order you should be placing
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based on where the stock price currently is. If I'm placing a sell ticket above the current price
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it should be a limit order. If I'm placing a sell ticket below the current price, it should be a
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stop order. So now if I were to X out of this and now scroll below the current price right here
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$77.24, you can now see if I were to click there, it is now a stop order. Now, if we were to come
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up here and hit the flatten button, what it's going to do is actually cancel that working order
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that stop order, and actually sell those 10 shares at the market price, completely getting
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me out of the position. Now, there are a few other things I wanted to show you on this active
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trader tool before we dive into the templates and that is actually the level 2 data as well as the
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active volume for the day. So looking right here on the active trader you guys will probably notice
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there are some red columns and green columns with a bunch of numbers flashing inside of there
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These numbers are actually the open orders to buy or sell the stock, basically the level 2 data
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Now in the red column you're going to see all of the open sell orders and in the green column you're
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going to see all of the open buy orders. It's also important to note that these are actually in
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hundreds of shares. So you always need to add two zeros to this number. Looking now at 77.34
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we can see an open order to sell 100 shares at 77.34. If I were to scroll down just a little
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bit, we can then see the buy orders to buy 1,000 shares at 77.28. Now it looks like 400 shares at
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77.34, but you guys can see this is changing constantly. Now another thing I'll mention is
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over here on the far left-hand side, you'll actually notice these blue columns right here
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This is actually telling you how many shares have been traded at specific prices
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Now that box went away kind of quick, but if I were to put my mouse over it again, you can actually see there have been 40,508 shares traded at 77.28 today
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If we were to go up a little bit further, we can actually see a lot more volume has taken place around 77.50
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And right here we can see 150,000 shares have taken place at 77.54
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It's also hard to tell and barely worth mentioning because it's so hard to see, but you'll also notice different shading in the background of that blue bar
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That's actually telling you how many shares have traded at different hours of the day
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So for example, let's actually say that Square has traded at $77.54 twice today
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You would actually notice two different shadings of blue in the background. If it traded at $77.54 three times today
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you would notice three different shadings of blue in the background. But again, it's so difficult to see, I don't think you guys are going to use that very often
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Now finally, moving off of the very simplistic way to use this tool
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which is basically just placing single leg buy or sell tickets, we can also create advanced orders through here
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Now, in order for us to do that, we will come over here to the template button up here in the top right-hand corner
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At the moment, you can see I currently have single selected, which just means I want to buy or sell one thing at a time
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In my case, what we're going to do is actually go ahead and click on that. And we're going to come down here
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and click one of the templates that Thinkorswim has created for us. For this one, we'll just go ahead
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and use the trigger with bracket. This form of advance order will basically allow us to set up multiple different orders all at once
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Now at the moment, what it's basically saying is after I buy or sell the stock
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I then want these two order tickets to go out right behind it. At the moment, it's saying I want to sell it for a $1 profit automatically
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or to stop me out if it ever drops a dollar. You guys do have the ability to customize these profit targets or stop-loss targets
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but for right now, let's just go ahead and leave it as the default. So as of right now, if I were to come up here and hit the buy market button
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what I'm essentially saying is I want to buy 10 shares of Square at the market price
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Then immediately, once that order ticket fills, I then want an order to go out there to sell it for a $1 profit
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or stop me out if it ever drops a dollar. So let's go ahead and do that just as an example
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I'm hitting buy market here. You can then see that I actually submitted three different order tickets
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First off, I bought those 10 shares of Square and I actually filled at $7,708
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Now immediately following that, I actually had an order ticket to sell it right here
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and we can actually see it's going in at $7808, $1 above where I filled
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And then right below that, I actually have a stop $1 below where I filled at $7608
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Now because this is a bracket order, whichever one of the sell ticket orders fills first
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it's going to automatically cancel the other order ticket. Now to make sure you guys get the hang of this let me go through several different examples And first let me come up here and flatten this position get back to zero Coming back down to the template button I actually going to flip this over from single to trigger with bracket just like before However this time I actually going to set a specific profit target and stop
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target. For me, let's say I'm typically trying to get a 50 cent profit. So I'm going to go ahead
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and change this from a dollar to 50 cents. And let's also say I like to get stopped out if it
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ever drops 1%. So first off, in order to change this from a dollar amount to a percentage amount
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I need to click this little plus or minus icon and turn it into a percentage sign. I'm then going
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to come over here and actually change this. And actually at the moment, it's right what I wanted
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it to be, 1%. Now, before I actually move on and actually use this, if I'm going to use this a lot
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in the future, I'm actually going to save it as a template. So in order for me to do that, in order
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to access this for future use, so I don't have to create it every single time, I'm going to come
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over here to this little floppy disk icon, go ahead and click on that. From there, I'm going to
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go ahead and give it a name, something simple, something I could remember it by, 10 shares
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50 cent profit, 1% stop. Just something I could remember. Now that I'm happy with that, we'll go
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ahead and hit save. And now from now on, if I click on this template menu, the template I just
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created will always be in here. So I'll always be able to quickly access it. I won't have to make it
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a bunch of different times in the future. But let's say we actually wanted to place this and
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instead of using a market order, I actually want to use a limit order. And I'm saying I only want
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to open this position if it drops down to 7710. So finding the little green box just to the left
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of the price, I'm going to go ahead and click on that. Now as soon as I do, you can see the opening
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order to buy the 10 shares is sitting right here at 7710, right where I clicked. Then looking over
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here on the right, we can actually see those limit orders and the stop order, which the limit is
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50 cents above and the stop is going to be 1% below. So right there. It's also a lot easier to
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see this just by looking over here on the left on my chart. And again, I could actually drag up or
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down these prices to adjust my profit target, adjust my stop, and adjust my opening trade
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Now in my case, let's say I change my mind. I actually don't want this to be submitted anymore
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I could just come up here to the cancel button and go ahead and hit cancel, cancel all. Now
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since we actually created a template for that order ticket, if I were to flip this over to a
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different stock, let's say I was now trading Microsoft, I actually have the ability to come
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over here to the template box and then select that 10 shares, 50 cent, 1% stop loss. Then just like
19:14
before, I could come up here and hit buy market and those order tickets get instantly submitted
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I've got the opening trade. I just bought 10 shares of Microsoft at $2.6713 and I'm currently
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down 70 cents. Then if I want to get out of it outright, I don't want to wait for that stop or
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limit to fill. I'll just come up here and hit flatten. Now you guys probably noticed there are
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other templates within here like trigger with two brackets, trigger with three brackets. I actually
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made a completely separate video on this, but this is how you guys can create multiple different
19:43
profit targets. So let's say I bought those 10 shares of Microsoft and I want to sell half at a
19:49
50 cent profit and then the other half at a dollar profit. That would actually be trigger with two
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brackets. If I instead had three different profit targets, that would be trigger with three brackets
19:59
But I think you guys get the idea. There are some pretty cool ways to really speed up your trading
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within Thinkorswim using ActiveTrader. Now, finally, the very last thing I'll mention in
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today's video on the ActiveTrader is how you guys can set up hotkeys to activate these orders as well
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Now, I did make a completely separate video on this much more in-depth, so be sure to check that
20:18
out if you want to learn more. But the very simple way to do this is by coming up here to the setup
20:22
menu in the upper right hand corner. From there you're going to come down to the application
20:26
settings window. Once this little pop-up window comes up we simply need to find and click on the
20:31
hotkeys menu. You can then see all of the hotkeys available down below and they're actually separated
20:37
in their own subsections. The one that we're going to be focusing on is the active trader section
20:42
So this is how we can very quickly place trades using actual keys on your keyboard. Now of course
20:47
you guys can adjust what key does what but as of right now you can see my buy market button is
20:52
control B and it looks like my sell market button is control S. So that means anytime I hit control
20:58
B, I'm going to buy X number of shares at the market price. If I were to hit control S, I'm going
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to sell X number of shares at the market price. So going through that for example sake, let me come
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down here and hit apply settings. And now coming over here to the active trader, let's next say I
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wanted to buy 10 shares of Microsoft at the current market price. What I'm going to do is go ahead and
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hit control B. Looking there, you can now see I did just buy 10 shares of Microsoft and I filled
21:25
at $267.11. Now, if I wanted to sell those shares, remember I could just hit sell market
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but in my case, what I'm going to do is actually hit control S. There we go. I just sold X number
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of shares. And remember it's the shares default in this box right here. And I just sold those shares
21:42
at the market price. Now, unfortunately, those hotkeys are not incredibly customizable and
21:47
they're not the most perfect way to trade, so for me personally, I would just continue using the
21:52
buttons on the Active Trader tool itself. But I think you see how useful this tool can be for you
21:57
day traders out there, and hopefully you all feel a lot more comfortable with it after this video
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I have made a bunch of other tutorials on Thinkorswim, so definitely check those out if you
22:06
guys would like to learn more. And if you did have other questions, leave them down below in the
22:10
comment section, and before leaving, hit that like button if you did find this video useful
22:15
But that wraps up today's video on the active trader. Have a great day, everyone, and I'll catch you on the next one
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