## How to Attach a Stop Order

Definition of, and how to attach a stop order.

## How to Attach a Trailing-Stop Order

Definition of, and how to attach a trailing-stop.

## How to Attach a Bracket to an Order

Definition of, and how to attach a bracket to an order.

## Secure Login with Interactive Brokers Secure Code Card

How to use the Secure Code Card

## Overview of the Scale Trader Algorithm

Overview:

The ScaleTrader is a sophisticated trading algorithm which allows one to enter a large quantity order that is executed in a series of increments or components, with each component being executed at a progressively better price.

When to Use
The use of this algorithm is well suited to situations where a stock is trading at or near the bottom of a trading range and the trader is looking to average down, buying into a declining market. Alternatively, it may be used on the opposite side when the trader is looking to sell into the top of the trading range, perhaps scaling out of a long position. In either situation, the Scale Trader algorithm also allows the trader to scalp the market, submitting opposite profit taking orders against the original order.

How to Locate

Order Set Up
Once the trader has defined the instrument and action (buy or sell), five parameters will need to be specified. Traders will also need to define the order type and time in force. These five parameters for a stock purchase (sale) would be as follows:

1. Total Order Size (TOS) – the total number of shares the trader is willing to purchase (sell) as the price falls (increases);
2. Initial Component Size (ICS) – the number of shares to be purchased (sold) at the Starting Price;
3. Subsequent Component Size (SCS) – the additional number of shares to be purchased (sold) at each Price Increment (at successively lower prices in the case of a purchase and higher in the case of a sale). If a SCS is not entered, the ICS will be used for all component orders.
4. Starting Price (SP) – the price at which you are willing to purchase (sell) the Initial Component Size
5. Price Increment (PI) – in the case of a purchase (sale), this is the decrease (increase) in price at which each successive component order is to be executed.
Based upon the inputs provided to those parameters, the Scale Trader application will calculate a Top Price (TP) and a Bottom Price (BP) which, depending upon the buy or sell action selected, will either determine the price at which the last order will be executed (BP for purchases and TP for sales) or be relevant only if the same scale is used to close or restore the size of the position (TP for purchases and BP for sales). Adjustments made to either of these two factors will be reflected in the PI and their calculations are as follows:

1. TP = (((ICS/SCS) -1) * PI) + SP
2. BP = SP – (((TOS - ICS)/SCS) * PI
Note that once a product symbol has been entered a price chart will be displayed to assist in specifying the parameters. The algorithm will not be activated until the Transmit button has been clicked and once transmitted will run indefinitely until stopped or changed or it encounters conditions where it stops. It's important to note that this particular algo will continue to run even if the trader is not logged in to the TWS.

Example
Assume a GTC limit order is entered into the Scale Trader to buy 1,000 shares of hypothetical stock ABC having a NBBO of \$19.95 - \$20.00 at a starting price of \$20.00 with 500 more shares purchased at every \$0.05 down, resulting in a maximum position of 4,000 shares. The five parameters for this order would be as follows:

1. TOS = 4,000;
2. ICS = 1,000;
3. SCS = 500;
4. SP = \$20.00
5. PI = \$0.05
This order would be then be scaled into 7 components consisting of one at 1,000 and 6 at 500 each. The first component is submitted at \$20.00 and after it fills the next component (500) would be submitted at \$0.05 lower. That order would wait until marketable and once it has been filled the next component will be submitted. This pattern continues until all components have been filled or the order has been cancelled.

1. Profit taking orders – the Scale Trader may be set to send an offsetting order to take advantage of periodic price surges or if the trader has reached a specified profit objective. This feature may be enabled by checking the box titled “Create profit taking order” and specifying the Profit Offset. Using the example above and a Profit Offset of \$1.00, once the ICS was filled at \$20.00 and an SCS submitted at \$19.95, two profit orders would also be submitted, one for 500 shares at \$21.00 and another for 500 shares at \$21.05. It should be noted that profit orders are scaled to the SCS regardless of the size of the ICS and that if the ICS > SCS then the profit order price is determined using the PI along with the Profit Offset.
2. Restore size after taking profit – if using the profit taking orders feature, the trader can enable the repurchase of shares sold at a profit at the price they were originally bought at by checking the box titled “Restore size after taking profit”. This feature remains active whenever the price is within the range of TP + Profit Offset and BP. Using the example above, if order to sell 500 shares at \$21.00 was executed this fill quantity would be put back into the original order at \$20.00 and the order submitted at \$19.95 would be cancelled.
3. Restart Scale Trader & Restart Scale Trader with Filled Component Size – these features allow traders using the profit taking order and restore size features to restart the algorithm if stopped, helping to resume the order starting from the point at which the scaled sequence left off.
4. Auto Price Adjustment – selecting this check box allows for an increase or decrease in the starting price automatically at stated time intervals (e.g., increase \$0.01 every hour)
5. Scale Trader Page – provides a view of the real-time status of scale orders, including filled and total quantity, filled, remaining, and total value, and the percent filled for each scale. Accessible via the Page and then Create Scale Trader Page menu options.
6. View Scale Progress - right-click on the scale order line and select View Scale Progress. This will open a window displaying the complete scale price ladder, the Open/Filled component list for the parent scale order, and the Open/Filled component list for the child profit orders.
Other Considerations
Acceptable inputs for this algorithm include:
1. Products – any product offered by IB other than mutual funds (e.g., stocks, options, ETFs, bonds, futures, Forex);
2. Order Type - limit or relative (relative not offered for combination orders)
3. Time in Force – Day, Good-til-Cancel or Day-til-Cancel. May also specify if order is allowed to be filled outside of regular trading hours, if executions may be routed and executed during pre-open session and whether to ignore opening auction.

## OPTION SYMBOLOGY INITIATIVE

INTRODUCTION

Beginning in 2006, working groups comprised of brokers, exchanges, clearing houses and vendors were formed in order to represent each of the U.S. and Canadian securities industries in a multi-year effort to develop a revised data format for representing listed option symbols. These efforts, referred to as the Option Symbology Initiatives (OSIs), are intended to provide the following benefits:

-         Decrease the number of errors in the front, middle and back office processes.
-         Represent the vast majority of listed option contracts using the same symbol as the
underlying security to reduce investor confusion.
-         Reduce corporate action symbol conversions.
-         Eliminate wrap symbols.
-         Eliminate the need for LEAP rollover process.
-         Reduce the frequency of coordination among exchanges for symbol elections.
-         Support the growth in product listings through additional expiration events and more
flexible strike price designations.

The following article provides background information regarding the products impacted by the OSI, the revised data format, project timeline and client impact as well as external links where additional information may be found.

PRODUCTS IMPACTED
The table below lists the product classifications of the US and Canadian exchange listed options which are impacted by the OSIs.  Note that while the mandated conversion date for Canadian options is identical to that of the US (i.e., February 12, 2010), the conversion of Canadian options was accelerated and completed by IB in September 2009.

 US Canadian Equity Equity (short cycle, regular full cycle and long term) Index Index Yield Based Foreign Currency Short Dated Flex

OSI DATA FORMAT
Each OSI will replace the 5-character code with a 21-character OSI identifier to be used in the transmission of listed option contracts between exchanges, the clearinghouses and their constituents. The 21-character OSI identifier comprises six data elements arranged in logical order, each with a minimum field size. An example is provided in the table below.

 5-character Code 21-character OSI Identifier* OSI Data Elements (minimum field size) Option Root Symbol [6]* Yr [2] Mo [2] Day [2] C/P [1] Dollar Strike [5] Decimal Strike [3] SZVXI SPX    111216P01900000 SPX 11 12 16 P 01900 000 WMFAW MSFT  100116C00047500 MSFT 10 01 16 C 00047 500
*If the Option Root Symbol is less than 6 characters, spaces are added to equal the six character minimum.

OSI TIMELINE & CLIENT IMPACT
The industry effort has been organized into two phases:

1. The Conversion Phase in which the OPRA code format will be dropped and the 21-character record layout employed to include the expiration day and decimal strike price. This phase was completed on February 12, 2010; and

2. The Consolidation Phase during which LEAPS, wrap, FLEX, short-dated and non-standard delivery contracts will have their symbols consolidated to that of the underlying (e.g. MSQ to MSFT).  This phase will take place over the 5 weekends starting March 12, 2010 and ending May 14, 2010. Note that there are certain contracts, referred to by OCC Class Consolidation Exceptions, which will not be consolidated.  These contracts include binary and CDO options, options having a 5 character underlying as well as  options having unique settlement terms (e.g., settle on open).  In addition, adjusted symbols which are the result of a prior corporate action will be consolidated to the new OSI corporate action format at the time the underlying class consolidates.

Outlined in the table below are the key milestone and effective dates for this consolidation phase and the products impacted.

 Milestone Date Action Issues/Series Impacted Effective Date Friday, March 12, 2010 Initial group of options representing array of product scenarios to be consolidated (approx 12 classes) Options associated with a strategic group of underlyings including adjusted and non-standard symbols Monday, March 15, 2010 Saturday, March 20, 2010 Standard Expiration Wednesday, March 31, 2010 Quarterly Expiration Friday, April 9, 2010 Consolidation of options whose primary underlying starts with the letters A-C (approx 503 classes) All options associated with 'A-C' underlyings including adjusted and non-standard symbols Monday, April 12, 2010 Saturday, April 17, 2010 Standard Expiration Friday, April 23, 2010 Consolidation of options whose primary underlying starts with the letters D-I (approx 486 classes) All options associated with 'D-I' underlyings including adjusted and non-standard symbols Monday, April 26, 2010 Friday, May 7, 2010 Consolidation of options whose primary underlying starts with the letters J-IR(approx 575 classes) All options associated with 'J-R' underlyings including adjusted and non-standard symbols Monday, May 10, 2010 Friday, May 14, 2010 Consolidation of options whose primary underlying starts with the letters S-Z (approx 503 classes) All options associated with 'S-Z' underlyings including adjusted and non-standard symbols Monday, May 17, 2010

IMPORTANT NOTE:
During this consolidation phase Good-till-Canceled (GTC) and Good-till-Date (GTD) orders will need to be canceled for all the option classes which are scheduled to consolidate. To accommodate this exchange mandate, IB will cancel all customer GTC and GTD orders on the Sunday of each milestone cycle.  Confirmation of these cancellations (outs) will be provided prior to effective date open (Monday) at which point customers may re-enter these orders utilizing the post consolidation symbol.

For additional information, please visit the symbology initiative sections of the OCC and Montreal Exchange websites.

## Technical FAQs - TWS

Can I run TWS on my system?
To ensure that you have an adequate Internet connection and proper system requirements to run TWS, we recommend that you first run the demo system.

How do I install TWS?
Find download instructions and the necessary files on the Installation Instructions page.

What are the minimum system requirements to run TWS?
Minimum and recommended systems requirements for both Windows and operating systems may be found by clicking here.

Should I use the standalone or browser-based TWS?
If you have a slower computer or Internet connection, we recommend that you use the standalone version of TWS. If you use the browser-based version, you can access TWS from any internet PC. The standalone version can only be accessed from the PC on which you installed the application. Otherwise, both require that you install the latest Java Runtime Environment and both function the same way.

How do I install/upgrade the Java plugin?
Go to the Java Upgrade Instructions page and scroll down to either the Windows or Mac operating system section. Follow instructions for upgrading the Java plugin. Note that if you want to upgrade to a newer Java version, you must first remove the existing plugin and then reinstall the upgraded version. Video instructions for installing the Java Runtime Environment for the Windows operating system can be found by clicking here.

What is a beta release, and how can I use it?
The beta release is a pre-production version of an upcoming release that allows you to actively trade while you test new features. You must deliberately elect to use the beta when you log in and should be aware that you do so at your own risk. Since the beta is under construction until production release, we welcome your input on its performance. The beta will be promoted to production after it has been tested both in-house and externally over a specified time period.

How do I know what changes are in a new release?
The login page includes links to both the beta and production release notes. These notes briefly describe new features and problems that have been fixed.

How will I know when a new TWS version has been released?
If you are running the standalone version, the update wizard will automatically check for TWS updates each time you log in to your PC. You can also manually check for updates from the Start menu by selecting Programs and then Startup and clicking Check for TWS Updates. Customers running the browser-based version will always get the most recent production release when they log in.

How do I reinstall TWS?
First, uninstall TWS by going to add/remove programs and removing TWS.  You can then reinstall TWS from the TWS Software page.

You will receive this message for one of the following reasons:
- You are not entering the proper username (check to be sure the Caps Lock key isn't on)
- Your account has not been set up yet

Instant help resources include the TWS Release Notes, TWS User's Guide, and the online tutorials. If you still cannot find an answer to your question, contact Customer Service.

Who do I contact for help?
IB has two distinct departments that handle specific types of TWS questions.Customer service deals with everything involving trading, accounts, funding and execution. See the Customer Service page on the IB website for contact details.The Technical Assistance Center (TAC) can help you with issues concerning your connection to IB and problems with the software involved. To help you more quickly, please:

- Call while you are experiencing the problem

You can also email us at tac@interactivebrokers.com.  Please include the following information:

- A detailed summary of the problem
- A timeframe of when the problem occurred or occurs.
- Detailed system specifications if possible, including:

* the Windows version you are using

* the version of Internet Explorer or Netscape (include cipher strength)

* the brand names of any Network Interface Cards installed in the computer

* your processor generation and speed

* the amount of memory installed in your computer

* the type of Internet connection you are using

* any other troubleshooting you have done on your own or with our staff

## TWS Order Checks

The TWS contains two checks to limit the possibility of customers entering trades at prices which are substantially inconsistent with that of the current market.

Under the first check, stock buy orders which are 10% above the prevailing NBBO ask price will be automatically rejected by IB as will stock sell orders which are 10% below the prevailing NBBO bid price.  In the case of options, IB's automatic rejection threshold percentage for both buy and sell orders is 20%.  When an order violating these parameters is transmitted, it will be rejected and a TWS pop-up window will be displayed with the following warning message: "Limit price too far outside NBBO".

The second check relates to orders which are transmitted at prices which do not violate the parameters set by IB as outlined above, but which do violate parameters established by the account holder.  Here the account holder is able to establish Precautionary Settings by selecting the Order and then Configure Order Presets menu options from the TWS. This will open up a window providing for the creation of price thresholds set in terms of percentage or the number of ticks outside of the NBBO (settings may also be defined in terms of share/contract quantity or total dollar value of trade).  When an order violating the account holder's parameters is transmitted, it will be rejected and a TWS pop-up window will be displayed with the following warning message: "The price specified would violate the percentage constraint specified in the default order settings.  Do you really want to submit this order".  Unlike in the case of the check set by IB, the account holder has the option of overriding their own settings and transmitting the order by clicking on the "Yes" button.

Glossary terms:

## How to empty the Java cache

Should you experience issues that would need a reinstallation of the platform and you are using the browser-based Trader Workstation (TWS) you have to empty the Java Cache. The cache is a repository for temporary files that have been downloaded from the Internet and contains browser-based applications or such launched trough the browser (the Internet browser is a program like Internet Explorer, Firefox or Safari).This is a simple procedure that ensures you can download again the latest application files from our servers.

Follow the instructions in this movie to empty the Java cache. To be able to run the browser-based TWS again you just need to launch it as usual.

This movie is destined to users with the operating system Mac OS X.