Can I Use thinkorswim for Analyzing Trades and Then Executing Them in Interactive Brokers?

Yes, you can use thinkorswim for analyzing trades and then execute them in Interactive Brokers (IB) to take advantage of their low fees. Whether this is a viable strategy depends on how you manage your analysis, execution, and the integration of both platforms. This article will guide you through this process effectively, ensuring that you do so within legal and regulatory compliance.

Research and Analysis

Utilize thinkorswim's powerful charting tools and technical indicators: begin by leveraging the detailed charts and robust research features of thinkorswim. You can set up watchlists, analyze historical data, and use the platform’s simulation tools to refine your trading strategies. This thorough analysis will help you identify potential trades and assess their viability beforehand.

Execution (Ute)

Manual Execution: After conducting your analysis on thinkorswim, you can manually utetrades in your Interactive Brokers account. Simply log into your IB account and place the trades based on your pre-analyzed data. This approach gives you control over the process but requires manual effort.

Automated Execution: If you want a more automated approach, you can use third-party tools or APIs to integrate the two platforms. This method could involve programming scripts that pull data from thinkorswim and send orders to IB. This may require some technical expertise and the right tools, but it can significantly enhance your trading efficiency.

Integration Tools

While thinkorswim and Interactive Brokers do not have direct integration, third-party tools and APIs can help. For example, you can use NinjaTrader to run the IB data feed, matching your charts with the prices you can actually trade at. This workaround is particularly useful for FX traders, as FX markets often require specific charting adjustments.

Cost Considerations

Cost Comparison: When considering this strategy, it's crucial to compare the costs associated with both platforms, including commission rates, margin rates, and any other fees. Low fees from Interactive Brokers can significantly impact your overall trading profitability. Be sure to factor in all associated costs to determine if this approach is financially beneficial for you.

Account Management

Compliance and Strategy: Keep your accounts separate and manage them according to your trading strategy and objectives. Compliance is key, so ensure that you comply with any regulations related to using multiple trading platforms. Use separate accounts to isolate risks and ensure that each platform is used for its specific strengths.

Using this approach allows you to leverage the strengths of both platforms—thinkorswim for analysis and Interactive Brokers for execution. This combination can provide a powerful toolset for traders looking to enhance their trading performance.

Note: This is not financial advice. It is always advisable to consult with a financial advisor or research thoroughly before making any trading decisions.

Several option traders already use this method, finding it beneficial given the strengths of each platform.

While thinkorswim is superior in options analysis, the charting package in Interactive Brokers is often considered inferior by traders. Third-party charting packages like NinjaTrader, ESignal, MultiCharts, and Tradestation are frequently used to overcome these limitations. These tools can provide a more comprehensive charting experience and better match the actual prices you can trade.

For those who primarily trade FX, charts can look different across brokers due to market specifics. A workaround involves using NinjaTrader to run the IB data feed, ensuring that your charts match the prices you can trade.