Trade Advanced Options

Place Advanced (Multi-leg) Option trades from the Options -Advanced tab in the Trade tab.

Choose Advanced for multi-leg option trades or Basic for single leg option trades.
Based on the Strategy and other variables you select, this window will find appropriate options contract pairings, if available.
An Advanced Option order consists of two legs which are sent to an option exchange where both legs have to fill at the specified net price. These order types help you avoid the risk of legging in (sending 2 separate orders at 2 specified prices).

Get a quick overview of all the Trade Tab features in this self-paced Trading training course.

STEP 1 - Set Up Strategy

Strategy Filter / Custom

Click Strategy Filter when you want to find option pairings based on a particular strategy.
Within the Strategy Filter, choose Custom when you know the option symbols you wish to pair.

Underlying Symbol

Type the symbol for the underlying equity or index for the options you wish to trade. When you are finished, click Get Spreads and view the results for the specified strategy.

Custom: For a custom strategy, enter the underlying symbol and then click Get Spreads. Select Custom from the Strategy Filter. Enter the option symbol for each legs, (Leg 1 will accept equity symbols as well). When entering an option symbol, follow the format: XYZ MM/DD/YYYY 00.00 C where XYZ is the underlying symbol (root symbol), followed by the expiration date, strike price and C or P for Call or Put.

Stock and/or option symbols and price and volume data shown here are for illustrative purposes only. Charles Schwab & Co., its parent or affiliates, and/or its employees and/or directors may have positions in securities referenced herein, and may, as principal or agent, buy from or sell to clients.

Trading Halted: If the stock you are viewing in Level II, Quick Quote, the Stock or Advanced Options trading tabs, or Charts is halted by the exchange, a yellow Trading Halted indicator will display prominently at the top of tool.

Strategy

Select the Strategy for which you wish to find option pairings. Refer to the Advanced Options Overview for more information on each strategy.

StreetSmart.com® automatically shows you only the Strategies that are available for your Option Approval level.

TIP: You may also select a strategy, and then click the Help link to access help about that strategy directly.

Strategy Variables

These are the fields where you can customize the pairing results by specifying calls/puts, expiration month, strike range, etc. Each strategy has a unique set of variables which are explained in the step-by-step Placing an Advanced Options Order topic.

STEP 2 - Select from results to load order

Option Pairings

Shows all the pairings for that symbol based on the Strategy and Strategy Variables you have selected.

Click on any of the pairings to load the order into "Step 3 - Set up order" panel.

STEP 3 - Set up order

Order Settings

In this panel, you will set up your contract quantity, action, price, etc.

PREVIEW TRADE

Preview

The Preview panel shows information such as Max Gain, Max Loss, and Break Even values for most opening transactions, which will adjust as you change the details of your order.

TIP: The potential Max Gain, Max Loss, and Break-Even values for opening option trades are also displayed in the Preview pane.

Click the strategy icon to open a Theoretical Profit & Loss Chart, which provide a graphical representation of the risk/reward associated with a specific strategy (single or multi-leg) before you enter into a trade.

These charts are available for opening transactions on single and multi-leg option trades (excluding the Rollout and Collar strategies).

Each chart has three profit & loss scenarios based on today’s date, the expiration of the option(s), and the midpoint of those two frequencies. You can use these scenarios to get an idea of the profit/loss associated with your strategy based on your expectations of where you expect the underlying price to trade.

Click Verify Order to see a summary of your order and to send the order.
Click Clear Order to go back to clear the current pairing from the order settings fields and return the Option Pairings panel to full size.

Read the Placing an Advanced Options Order topic for step-by-step instructions for placing an Advanced Options Order.

Commissions, taxes, and transaction costs are not included in any of these strategy discussions, but can affect final outcome and should be considered. Please contact a tax advisor to discuss the tax implications of these strategies. Many of the strategies described herein require the use of a margin account. With long options, investors may lose 100% of funds invested. In-the-money long puts need to be closed out prior to expiration, since exercising them could create short stock positions.

Options carry a high level of risk and are not suitable for all investors. Certain requirements must be met to trade options through Schwab. Multiple leg options strategies will involve multiple commissions. Please read the options disclosure document titled "Characteristics and Risks of Standardized Options." Member SIPC