How to Stop Thinkorswim from Automatically Netting Overlapping Positions
Introduction: If you're like me and have found yourself frustrated by Thinkorswim's automatic netting of overlapping positions, you're not alone. After spending hours trying to figure this out and reaching out to Thinkorswim support, I've realized there are certain limitations to the platform when it comes to maintaining both long and short positions on the same security. Here's what I learned and how you can navigate this issue to improve your trading experience and recordkeeping.
Understanding the Issue: Thinkorswim, like many trading platforms, is designed to automatically net overlapping positions. This means if you hold both long and short positions on the same security, the platform will automatically close out or reduce your existing position. Unfortunately, this is a built-in feature with no way to disable it. This can be particularly challenging for traders who need to take overlapping positions for various strategies.
Response from Thinkorswim Support: Here’s the direct response I received from Thinkorswim support:
Dear Mr. Ney Torres,
Thank you for messaging Schwab! My name is Lucas and I am happy to assist.
Thinkorswim will not allow you to be long and short on the same security at the same time, so if you enter an order that reverses your existing position, it is going to close out or reduce your existing position. Regrettably, there is no way to avoid that. I apologize for any inconvenience.
Please let us know if you have any other questions about this. We appreciate your business.
Regards, Lucas
Manual Recordkeeping: Since Thinkorswim will automatically net your positions, keeping a manual log of your trades can help you track your performance and strategies more accurately. This can be time-consuming but is essential for maintaining a clear record of your trading activity.
Conclusion: While Thinkorswim's automatic netting feature can be a hindrance, understanding this limitation and implementing workarounds can help you manage your trades more effectively. Whether through using multiple accounts, adjusting your strategies, maintaining manual records, or leveraging third-party tools, you can find ways to keep accurate logs and follow up on your positions.
Trading is complex, and platform limitations are just one of the many challenges. By staying informed and adaptable, you can continue to refine your strategies and achieve your trading goals.