Best Options Brokers
Which brokers offer the best tools and lowest rates to options traders?
Finding the best options broker is a challenge because there are many factors to evaluate. Price is a top priority for most options traders, but you also need to think about the available trading tools and efficient order execution technology. Thorough research materials are also vital to success. Weighing all of these categories, we came up with a list of the three best options brokers.
Our top picks for the best options brokers
The three companies below are who we rule the best options brokers after taking a look at nearly 100 features in the business.
- Affordable rates: OptionsHouse has some of the most affordable options trading rates in the industry.
- Fast order entry: OptionsHouse’s trading platform allows you to enter and edit orders quickly and easily.
- Proprietary trading tools: The Spread Investigator, Trade Generator and Risk Viewer help you identify trades.
- Base fee: $4.95
- Contract price: $0.50
- Required Minimum: None
- Access to in-depth research: TD Ameritrade offers a plethora of research material to help you make decisions.
- Highly rated: TD Ameritrade's thinkorswim platform was ranked among the best for options traders by Barron's.
- Efficient order execution: Enter and execute options trades with lightning speed.
- Base fee $9.99
- Contract Price $0.75
- Required Minimum None
- Powerful investment search tool: The Dragon tool helps you find options trades that match characteristics you identify.
- No base fee: OptionsXpress doesn't charge you a base fee in addition to a per-contract rate.
- Help designing a strategy: The StrategyScan tool helps you find a trading strategy that fits your goals and experience.
- Base Fee $0
- Contract Price $1.25 - $1.50
- Required Minimum $12.95 - $14.95
What to look for to find the best options brokers
Fees are worth considering no matter what type of trading you do, but this is especially true for options trading. Most brokers require you to pay a base fee, in addition to a per-contract rate. Some companies, like optionsXpress, only charge a per-contract rate. The catch is that fee is higher and there’s also a required minimum. OptionsHouse charges some of the lowest fees around, so they’re the best bet for high-volume traders.
Trading and analysis tools help you identify and execute options trades. Many brokers have proprietary tools, so you need to do some research to figure out which company has the resources you’re interested in. Another thing to look out for is how quickly you can enter orders in the trading platform. It’s critical to choose a company that makes this process fast and easy. All companies on this list do well in this area, so it’s a matter of individual preference and finding the tools that best align with your goals and strategies.
Access to advanced research is critical for identifying the best options trades. Research can come in many forms, including company publications, market commentary from industry experts, and daily market news. Some brokers also offer more advanced research for those willing to pay an additional fee. TD Ameritrade stands out from the list by offering some of the most comprehensive research materials, including free third-party research reports.
The Bottom Line
All three brokers on this list are excellent choices for options traders, but our recommendation is OptionsHouse, due to their affordable rates and advanced trading tools. However, it’s all depends on your priorities. For example, if access to high-quality research is a top priority for you, TD Ameritrade may be a better fit than OptionsHouse.