TWS Charts Futures Term Structure

Study Notes:

Trader Workstation charts allow futures traders to:

• Compare the current term structure for an existing series of maturities with historical data points;
• And by selecting preset or custom dates, you can quickly see how the pricing structure has changed over time.

Let’s walkthrough how to do this with TWS charts.

I’ll right-click on NYMEX-listed crude oil futures, then select term structure from the expanded display.

You’ll see that the chart contains two halves,

• with the upper part containing available live prices for crude oil futures contracts across the entire maturity spectrum,
• and the bottom, which calculates the differences between the older settlement price curves and the most recent selected curve.

If I click on the + expansion menu at the top, I can select another time period to display.  Let’s select 1 month.

The chart now displays each of the selected price curves. Remember that the bottom chart plots the price differential between the two values, enabling you to see the extent of the term structure change between the chosen time frames.

By default, a yellow color gradient is used for different series. To modify the colors, click the configuration wrench icon in the top right corner of the window and select Rainbow to use different colors for each line or select a new color to use with a gradient.  This is great because the colors pop out and you can easily see the differences as the color changes in the text too.

Now, let’s return and expand the menu at the top left of the chart and customize dates for comparison purposes.

Just click on a custom date field to see a calendar and make your selections. Let’s compare current prices for crude futures against year-end closing prices at the end of 2018 and 2019.

With the pushpin in place at the upper right corner of the chart, I can click on other futures contracts in my monitor panel and quickly contrast a new selection of futures curves over time.

You should now have a better understanding of how to create and customize charts of futures contracts in TWS and compare current term structures for an existing series of maturities with historical data points.