New

• In February Schwab released significant improvements to their downloaded StreetSmart Edge (SSE) package (version 1.18.129).  I won’t cover all the changes, but I”ve seen at least 4 significant improvements:
  • The new “Trade-All in One”  tool significantly improves option trading with better visibility and customization
  • You can save up to five different snapshots of your StreetSmart Edge configuration on Schwab’s servers—you can access these from any of your computers
  • New “bracket” capabilities allow you to add profit exits, trailing stops, and stop losses all on the same position
  • Default share / contract quantities can be set on a per security basis
• At same time Schwab up dated their Street Smart Edge in the Cloud  (current version 1.20.604)
  •  This version of SSE runs on Schwab servers, with only a light-weight display client on your computer.  This allows SSE to run comfortably on underpowered computers, MAC, etc.  It’s my default choice on my Windows 7 machine because it runs faster than the downloaded version.  The cloud version for the most part has equal or superior features.   For more information see this post.

Review

Steetsmart Edge is launched by qualified users on the Schwab website. Before I get to my complaints here are some things that I like:

• Accessing / trading options is nicely done.  Option chains come up collapsed down to expiration dates, which you can then open up.  Copying options to a watch list is conveniently accomplished with copy and paste commands.  Current positions are shown in the option chains—a nice feature.
• Option chains allow an adjustable number of strikes from 1 to 20 or all.  It’s very nice to not have to deal with huge lists of options when my interests are relatively close to the money.
• I really like the availability of midprice quote, halfway between the ask / bid price—very useful for options and lower volume securities.
• The new “Trade-All in One” tool significantly improves Schwab’s capability for two side option trades (e.g, spreads, calendars, buy-writes)
  • Once you select your trade the options appear at top (see snapshot below).  You can then further customize the options you want (e.g., strikes, expirations)—this avoids significant frustration if you have a different opinion than the tool on what the strikes for say a strangle should be…
  • You can add additional tabs to the tool.   I use this for displaying alternate option strategies, or the plain options chains with all the Greeks
  • The midpoint price, the max gain/loss, current underlying price are all right there

• The scrolling / time windowing capabilities located at the bottom of charts are excellent
• SSE’s ability to export data, including option Greeks from a watch list to a spreadsheet is useful
• Very good coverage of two sided option strategies, including calendars and ratio spreads.  All the Greeks available for the options in the strategy
• ETF/ETN intra-day indicative values are available (effectively NAV).   To obtain these add a “$” and the beginning, and “.IV” at the end of the symbol (e.g., $SPY.IV).   These are helpful in getting good price execution on orders.
• Charts include the ability to add option IVs as a study.  This is a big help in looking at typical IV run-ups before earnings reports.

Some complaints:

• Email not supported for alerts—really?!
• SSE wants everything in upper case.   If you type in symbols in lower case it capitalizes them.  OK so far.   However if you try to enter in capital letters, matching what is on your displays it very unhelpfully lower cases those letters so that the symbol is not recognized.   My favorites are indexes like $VIX or intra-day indicative values (e.g., $VXX.IV) where you have to hold down the shift key for the “$” and then use lower case for the rest. This is so wrong.  Just capitalize everything, OK?
• Three or four sided options strategies like butterflies or condors are not explicitly supported, you have to piece them together
• The computed Greeks on VIX options are wrong.  The VIX is used as the underlying instead of the actual VIX Futures.   Knowingly putting out incorrect information for some of highest volume options in the market seems inexcusable to me.
• When using the bar style on charts a line is green if current price is higher than open,  even if the price is down from the previous day’s close.  At least need an option to key off previous close instead of today’s open..
• The charts have a lot of nice features, but they have a “frequency centric” approach.  You must pick the frequency (e.g., 1 minute or daily) and then the  chart then picks the duration (e.g., 5 days or 254 days).   This is bass ackwards—I want to pick the duration and then have the package provide the maximum frequency it will deign to provide—the higher the better.
• Slow initial startup time.   Even with a fast computer the package takes a long time to startup.   Switching layouts, or loading the layout from the central Schwab server extracts additional time.  They have added a “quick launch” option on the settings, but it doesn’t seem to make much difference.
• The default on the colored “link” symbol in the upper right of many tools ties all the windows to the same ticker.   Generally if I open multiple tools I”m comparing things so having them all sync’d to the same symbol is counterproductive.  To work around this I have to manually change the link to the “unlinked”, broken chain symbol—I think unlinked should be the default.    The link feature is nice if you want to click through your watch list and have a chart displayed for the highlighted symbol.

Some tips:

• To activate the bracket capabilities go to account details, positions tab, select a symbol, push the actions button and then look for the “add brackets” choice
• Default share / contract quantities can be set on a per symbol basis by going to general settings, trading tab, and then look for order quantity button
• Typically I’m using multiple computers in the course of a day so I use the save as / load from Schwab server capability located under “file” on the main window.  This keeps my layout consistent between computers.   This should be a default choice for the user—local or server based layout at startup.  Schwab now allows up to 5 different setups to be saved on their server.
• If you find yourself frequently flipping between different tools (e.g., watch lists and charts), consider putting them on different tabs.  This avoids a lot of tool finding and you can flip contexts with a single mouse click. These tabs can be put on different displays if you have them.
• If you are running an older version  I recommend you upgrade.  You don’t have to remove your current version of Street Smart Edge, you can download the new version from the Schwab site and install the newer version.  I haven’t lost any settings.  Your current version shows up in the upper right hand corner of the application.

Wish List

• Greek calculations for options are using time to expiration in coarse 1 day increments.  This leads to significant errors when the time to expiration gets down to less than a week.  Using more precise time until expiration (e.g, 30 minutes) would give more accurate Greeks during the day.
• Stop loss orders (both market and limit) that have a time delay parameter option that delays any action for a specified number of minutes.  This would reduce the chances that a position is blown out by a flash crash.
• Charts for options that have expired
• Option charts using mid price (halfway between bid and ask) at some reasonable frequency, like 15 minutes, instead of relying on trade data which is infrequent for most options that are offered

Performance notes

• If you are having performance issues I recommend you call your broker and sign up for StreetSmart Edge in the Cloud.   The cloud solutions have performed much better for me on my Windows 7 machine.

Summary of Defects (in my opinion)

• The Greeks on $VIX options are incorrect
• Charts setups don’t remember that mode has been set to bar format.  They always go back to candlesticks on new charts
• Uncapitalizing letters that are typed in as capital
• Left click doesn’t work when editing a symbol in the watchlist—you have to use other editing keys like arrows or backspace
• If you enter a duplicate symbol in a watchlist your input is ignored—without explanation
• Stock splits are not adjusted for in  .IV charts
• Watch lists with groups seem to spontaneously reorder themselves—putting the groups on top
• “Last trade” column for IV values (e.g., $JNK.IV) doesn’t appear to update rationally.  Should actually be blank, but it would be alright to update it when the underlying trades