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What is the OptiView Magic Wand tool?

OptiView's Magic Wand tool searches the option chain for contract combinations that maximize the risk-adjusted expected return. Users define a path along which they expect the underlying to develop, and the tool returns the combination of options that yields the highest risk-adjusted return along this path.

How Magic Wand works

  • Draw a price path on the chart to express where you expect the underlying to move. This path represents your subjective view on the direction and range of the stock
  • Magic Wand extracts the market-implied probability distribution from live option prices across the chain, then adjusts it to reflect your drawn expectation
  • Every combination of options up to the selected maximum number of legs is evaluated across the resulting set of price scenarios
  • The combination with the highest risk-adjusted expected return, balancing expected profit against potential tail losses, is returned and added to the strategy builder

Magic Wand settings

  • Net Payable: Debit filters to strategies that cost a net premium upfront, Credit filters to strategies that collect a net premium, and Both considers all combinations regardless of direction
  • Defined-risk: When enabled, only combinations without naked short positions are considered, ensuring every strategy has a capped maximum loss

Plus options

  • Path distribution: Controls how the expected return is derived: Range integrates the strategy's expected value over an asymmetric probability distribution, Line computes the expected value on the drawn path only
  • Risk adjustment: Sets how aggressively the optimizer weighs expected return against tail risk; Low favors strategies that protect against large losses, High favors strategies that maximize the expected return with less concern for tail outcomes, Moderate balances both
  • Max Legs: Sets the maximum number of contracts in the returned combination, from 1 to 4; higher values allow more complex multi-leg strategies

Related Questions

Strategy Builder
What is OptiView's Strategy Assistant?OptiView's Strategy Assistant searches the option chain for contract combinations that match user-defined objectives and constraints. OptiView offers both a Basic and Advanced Assistant to guide you through constraint setting. In both modes, the Assistant returns a list of candidate strategies.
Strategy Builder
Can I compare options strategies side by side?OptiView allows users to compare up to three options strategies side by side within the options strategy builder. Users can analyze payoff, risk, and position structure across multiple strategies in parallel.
Subscription
What is included in the OptiView Plus plan?OptiView Plus is the paid subscription tier that unlocks features beyond the free plan, including the Advanced Strategy Assistant, Multi-leg strategy scanning, heatmap Greek analytic tools, unlimited side-by-side strategy tabs, and output customization in the Magic Wand tool. OptiView Plus is available at $20 per month or $100 per year.