Installation of TWS API - Interactive Brokers Part 1

One advantage of Interactive Brokers (referred to as IBKR or just IB hereafter) over Kite Connect or Upstock API is that IB provide's a Paper Trading Account.

If you are an Individual, you can signup for the free trial ofInteractive Brokers . This basically gives you a "Paper Trading Account" with access to all the IBKR platforms for a couple of months including the TWS and Mosaic platforms. For the purpose of live testing our trading strategy , we have access to  Market Data ( Delayed by 10-15 minutes) and the API for retrieving data  (Not all Data) and placing orders. So yeah, the trial version of IB provides "Limited Functionality" for testing your strategies using the API. 

Some of the things that you can do with ApplicationProgramming Interface(API) from IBKR  :

• Automate your strategies
• Create a custom trading terminal
• Develop a Screener
• Experiment with your own Trading Indicator

Basically if you are reading this, you know why you have opted for IBKR.

Its is important to note that there are other third party Libraries in Python like ib_insync, IbPy and IBridgePy. But these have been developed well before the release of the Python Native API which is developed by IBKR . Only the API developed by IBKR is officially supported by IBKR.  For more information on the API, Check the YouTubelink for the official videos of TWS Python API

And besides the TWS API, there are also other API solutions that are offered by Interactive Brokers and check them in this PDF download.  Also one can check out groups for discussion on  API

It is always helpful to get a feel of the web interface of IB which they refer to as Client Portal and Trader Work Station(TWS) before we get started.

Different Types of IB Accounts:

Before you go any further it is important to realize that there are three types of accounts that one can have with IB:

1. Free Trial Account: This a Demo Account and does not have the capability to receive real time market data. It can only display delayed data. Clients can gain access to demo accounts even if they are not a part of IB as this is a free trial account.
2. Live Account: This is a live trading account which has all the features and receives delayed data by default. And you can subscribe for real time marked data.
3. Paper Trading Account: This is a testing account and receives delayed data by default. This account can also get real time data from live account. This is the account that is used by developers who want to test out the capability of the trading strategies viz. the API.

Why Paper Trading Account for testing the API ? Ah Well !!! It turns out that we have a function named reqRealTimeBar and reqHistoricalData. Both these functions are very important to retail traders as they deal with OHLC data. But to get this data, we need to get real time data. We can get this real time data only if we subscribe to the real time data through a Live Account. In the Indian context for the NSE data, you will have to open an account with IB and deposit a minimum of $500 (at the time of writing this blog post)and then instead of using the Live Account, develop your strategies by using the the Paper trading Account. For further details check out the account opening Information for Indian Individuals

To demystify the testing of IB's Python API, take the following steps:

1. Open a demo account
2. Get a feel for the Trader Work Station(TWS) desktop trading software.(whatever can be done in TWS can be done using the TWS API)
3. Open a paper trading account
4. Check out how the API works for placing orders and get a feel of contracts
5. When you want access to start testing the functionality of the reqRealTimeBars function, reqHistoricalData function or reqTickByTickData function , at this point get a Live Account by depositing the minimum required to your account . 
6. Once your live account is open and funded, login in to Client portal --> Menu(left side ) --> Settings --> User Settings --> Market Data Subscription --> Click on check box for NSE. Check out this link for details on Subscribing to Market Data . Then add an instrument in live account TWS and you should see the live streaming data.
7. Share Live Market Data from Live Account with paper trading account: Login in to Client portal --> Menu(left side ) --> Settings --> Account Settings --> Configuration --> Paper Trading account. Check out this link for details on Paper Trading Account
8. After this, you can test your code by connecting it to paper trading account. Also, in the python code, request market data type should be reqMarketDataType(MarketDataTypeEnum.REALTIME)

Install TWS for Windows:

IBKR calls their desktop app as Trader Workstation(TWS). While the installation of the TWS is not very strictly necessary, in the beginning stages it can be helpful as we can use the TWS for viewing the orders that we have placed viz. the API. Another point to note is that whatever operations we can perform by using the TWS can also be accomplished by using the API.  The latest TWSfor Windows is available for download here . In case you want the beta version , you can check up with the link under "Software & Downloads" section in the IBKR main page.

Install TWS API Components:

In the IBKR website go to Downloads-> APIs and click on the API Software. This will take us to the GitHub link for the downloadof IBKR Python Native API Components  also called as the TWS API software.

I prefer to download the "TWS API Latest for Windows". Next Run the Downloaded msi file and complete the setup wizard. This will copy the required Python source files to the hard disk. The default folder for installation on a Win 10machine is  C:\TWS API . It also copies two files in the Windows directory for the DDE and C++ APIs. It is Very Important to Ensure that that the API installs to the C: drive, as otherwise API applications may not be able to find the associated files.

• After completion of installation go to the directory  C:\TWS API\source\pythonclient . In this folder, run the setup.py file.
• To run the setup.py file when you are using anaconda distribution, these are the steps to follow:
• Open the Anaconda Prompt . Ensure to right click and "Run as Administrator".
• Change the Path to where the setup.py file is located.
• On the command prompt type in "python setup.py install"
• This should copy it to the correct anaconda folder. If you are successful, you should get  message that reads like -  Copying ibapi-9.79.1-py3.7.egg to c:\programdata\anaconda3\lib\site-packages

• To ensure that the installation is correct , open an Ipython Console  and type in import ibapi . If this does not throw out a message ModuleNotFoundError: No module named 'ibapi , then the installation of ibapi module is correct.

A couple of points to note here:

1. Ensure that version 9.73 or higher is installed. This is necessary to obtain the TWS API source and sample code.
2. In case a previous version is installed, Uninstall the "TWS API" from the "Add/Remove Tool" in the Windows Control Panel.  Then delete the C:\TWS API\ folder. Locate the file "C:\Windows\SysWOW64\TwsSocketClient.dll". Delete this file. Restart the computer before installing a different API version

3. Python version 3.1 or higher is required to interpret Python API client.
4. Go through the windows version of the TWS software before using the TWS API. If any feature is not available in TWS, most likely it is not available in the TWS API .

Download and Install IB Gateway:

Now instead of installing the TWS API Components, we can also opt to install the IB Gateway. If we go to the Downloads -> IB Gateway , we can download the IB Gateway Software. This is also a standalone download and the main difference between TWS and IB gateway is mentionedon the same link . Its given below :

Feature	TWS	IB Gateway
Provides a GUI that allows you to see and manage API orders.	Yes	No
Must remain running to maintain access to IB trading system.	Yes	Yes
Can be installed from the IB web site LOG IN menu.	Yes	Yes
Can also be used as a connection interface for the FIX CTCI API.	No	Yes
GUI-less interface runs more efficiently and uses fewer system resources. 1	No	Yes

Configure TWS for use with API

Open the TWS software , click on the File Menu --> Global Configuration --> API and make change in settings as shown below:

We can also set the Logging Level to "Detail" . Logs are stored in the TWS settings directory, C:\Jts\ by default on a Windows computer.