Think or Swim Tutorial - How to place buy and sell orders

By growithyou

This tutorial explains how to buy and sell orders in the Think or Swim Trading Platform. By the end of this article you will be able to easily place Orders related to Stocks and Options on your own. If you find this tutorial interesting read also Placing Buy and Sell orders in the ThinkorSwim Trading Platform (Tutorial).

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Information to provide to the broker

Whenever you enter an order there are general five pieces of information you must provide to the broker:

The side of the trade you are; are you buying or selling?
The symbol you are interested to trade in indicating also the month and strike related, so that the broker knows which stock you are referring to.
The number of shares or contracts (if you trade options) you trade in.
The price, so to determine in which way your order will be handled by the broker and you can do that by placing a “Market order” or a “Limit order”.
The time in which your order has to remain opened that is called the “Time In Force - TIF” and you can do it by placing three different kinds of orders: “Day”, “Good-Til-Canceled – GTC” or “Extended Hours - EXT” orders.

How to set the order price

Market Order: It will be surely executed, but it is not guaranteed the price at which the order will be filled.

Limit Order: It will not surely executed, but it is guaranteed the price at which the order will be filled.

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How to set the time of the order

Day Order: It is valid only for the current trading day. It means that if the order is not filled during this time then it will be cancelled at the end of the trading day.

Good-til-Canceled (GTC) Order: It is valid until it is either filled or cancelled.

Extended Hours – EXT Order: It is valid only for the current extended trading day.

Place an order in the Think or Swim platform

To place buy and sell orders in Think or Swim is very easy and versatile. The main way to do it, but as you become more confident with the platform you will see there are also other ways, is to click in the “Trade Tab” in the left side corner of the platform. You have to begin by taping in the symbol box that appears the ticker (stock symbol) that you want to trade. If for example you want to look up the Bank of America stock, you should tape in the ticker BAC.

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Now it will appear several pieces of key information below, under the word underlying. Let’s quickly review what that information means:

Last: It indicates the last price at which BAC was traded in.
Net Change: It shows how far up or down this last trade is from the previous session closing price.
Bid: It shows the highest price at which someone is willing to buy.
Ask: It shows the lowest price for which someone will sell. The difference between Bid and Ask is very important to understand in Think or Swim because it will generate buy orders by clicking on the ask price and sell orders by clicking on the bid price.
Size: It is always reported as a pair of numbers. The first refers to the bid, the second to the ask price. They show how many out of 100 shares they are ready to price. If for example the size is 41 by 8 we know that there are 4100 shares available at that bid price and 800 available at the asking price.
Volume: It shows how many shares have been traded today.
Opening price: It shows the first price at which the stock was traded when the market opened that day.
High: It shows the highest price for the day.
Low: It shows the lowest price for the day.