Published: September 30, 2025.
Last Update: July 2, 2026.
The Trade Builder is designed to help you quickly identify an options trade that aligns with your market outlook and sentiment. Whether you’re bullish or bearish, short-term or long-term, the tool provides a clear, actionable trade idea tailored to your preferences.
By leveraging TradeSmith’s proprietary indicators and Fair Value, the Options Trade Builder helps you move from outlook to execution with confidence.
To access the tool, hit the Trade Builder tab under your Options360 page at the top navigational header:
Screenshot taken from an Options360 account on Jul. 2, 2026.
How It Works: Three Simple Steps
Step 1: Enter Your Ticker Symbol
Start by entering the stock symbol you want to analyze.
Step 2: Select Your Timeframe
Choose the time horizon that matches your trading style:
- Short-Term: Typically one month or less.
- Intermediate-Term: About one to three months.
- Long-Term: About three months or longer.
Step 3: Choose Your Sentiment
Decide whether you are Bullish (expecting the stock to rise) or Bearish (expecting the stock to fall).
From there, the Trade Builder scans the market to identify contracts that fit your criteria. It automatically excludes trades with low liquidity and contracts affected by earnings announcements, which can introduce hidden risks.
The Option Tile Cards
Once the Trade Builder identifies a trade, it presents the results in easy-to-read option tile cards, which include:
- Trade overview
- Valuation
- Underlying asset data & forecasts
- Top spread (if available)
- Key statistics
This information helps you evaluate not only the trade itself but also the balance between premium and risk.
- High Premium = Higher Risk
Volatile stocks (biotech, small caps, meme names) often offer rich premiums—but carry a higher risk of sharp moves. - Low Premium = Lower Risk
Stable, blue-chip stocks typically have modest premiums, but the downside risks are smaller.
Ask yourself:
👉 “Is the potential income worth the downside risk, and am I being fairly compensated for this obligation?”
Note on The Trade Builder
The Trade Builder will show you the best trade for the ticker you enter, but that doesn’t always mean it’s a trade worth taking. The option may be overpriced, resulting in a negative return.
- Advanced traders can use this insight to consider constructing an opposite trade.
- Novice traders can learn that it’s better to look for an alternative setup.
With thousands of stocks and hundreds of thousands of option contracts, not every trade opportunity will be a good one at any given time.
📈 Interpreting Trade Builder Results
The Trade Builder matches the option that best aligns with your stock outlook. The "best match" does not guarantee that the trade is good or profitable.
📉 Negative ROI
A negative ROI means this option is not positioned for a positive return. By choosing to proceed, you accept the potential for an unfavorable outcome.
🔎 Valuation Models
Valuation is determined by models. An option (or stock) may appear undervalued, but that does not mean it is a buy:
- A low P/E ratio does not always mean a stock is undervalued. The low P/E ratio could be due to weak growth prospects or high bankruptcy risk for the company.
- Similarly, a model may indicate an option is undervalued, but that could be due to volatility or temporary market reactions.
⚖️ Key Takeaway
Undervaluation alone does not make a trade worthwhile. It's important to consider other factors besides valuation when buying an options trade or a stock.
What’s Next: Phase 1 and Beyond
This is just Phase 1 of the Trade Builder. Our development team is continuously working to refine the tool, incorporating additional metrics and enhancing features to help you find your optimal options trade with even greater precision.
Need Help?
Our Customer Success team is ready to assist:
- Phone: 1-866-385-2076 (toll-free)
- Email: [email protected]
*Note—The tabs and features you see on your TradeSmith Finance site will vary based on your subscription(s) and subscription level(s).