Choosing the best options trading platform could be the first step on your journey toward immense wealth. Learn the factors for making the right decision here.
Choosing the best options trading platform could be the first step on your journey toward immense wealth.
But what makes a platform the best?
If you ask 10 people what makes a good options platform, you may get 10 different answers. That’s because everyone has different trading needs.
It all depends on the level of trading skills you possess. If you’re new to trading options, you will want a broker with fantastic educational resources and guidance. On the other end of the spectrum, professional traders are going to be looking for the best research tools or perhaps the lowest fees.
So what are you looking for in an options trading platform?
Check out our list below of the best options trading platforms to help you decide which one you should go with.
Best Overall Options Broker: E*TRADE
We’re starting at the top here with E*TRADE’s Power E*TRADE platform and mobile app. Power E*TRADE provides you top-tier trading tools without paying top dollar.
Whether you’re looking for financial trading 101 guidance or professional level trading tools, the E*TRADE platform offers a little something for everyone.
You can test the waters with virtual trading. The tradLAB Snapshot Analysis tool allows you to quickly identify risk/reward ratios and gives guidance on what to look out for. Or if you simply want to look for potential trading strategies, the strategySEEK tool will quickly scan market data for you.
Best Options Trading Tools: TD Ameritrade
TD Ameritrade is the gold standard when it comes to the options trading tools on their thinkorswim platform. The online brokerage offers tons of educational content, including live coaching and video updates.
But it’s the tools that people like the most about TD Ameritrade. You can choose your options strategy, assess risk and quickly roll spreads to future dates. Advanced options trades utilize the many different options selection tools and risk management.
Best Low-Cost Options Broker: Ally Invest
Excessive fees can put a drain on your trading returns. That’s why Ally Invest is making a name for itself by providing low-cost options trading fees.
Ally offers options investments at $4.95 per trade plus 65 cents per contract. That price lowers to $3.95 per trade and 50 cents per contract if you make at least 30 trades per quarter. You also receive lower trading fees if you have at least $100,000 in your account.
Ally Invest provides its traders with consistently low margin rates compared to the other major trading platforms. You’ll find a trading margin of ly 8.75% for balances between $0.01 and $9,999.
Best Broker for Frequent Options Traders: Interactive Brokers
Interactive Brokers is the perfect option for advanced, high-volume options traders. The trading platform features international trade capabilities and low commissions.
Many traders, especially newer ones, do not take kindly to the platform’s inactivity fees and high balance requirements. You also won’t find extensive educational resources, but it is improving in this area.
Interactive Brokers features a complex trading platform, called Trader Workstation (TWS) that is ideally suited to advanced traders. TWS offers endless research options and risk management tools. You can even predict a trade-in IB’s Probability ab, which lets you test a potential trade before you trade with real money.
The Bottom Line About the Best Options Trading Platform
Choosing the best options trading platform comes down to knowing what kind of trader you are. What tools would you like to utilize? Do you need educational resources to improve your level of knowledge? What is your trading style?
Once you know what is important to your trading success, refer to the list of options trading platforms above to determine which is best for you.
If you found this article helpful, please check out our guide to the eight best apps for new stock traders.