Broker Review BQ Options

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Binary Options Broker 2020!
    Good Choice for Beginners!
    Free Trading Education, Free Demo Account!
    Get a Sign-Up Bonus Now!

  • Binomo
    Binomo

    2nd in our ranking!

11 Best Options Trading Brokers and Platforms of April 2020

At NerdWallet, we strive to help you make financial decisions with confidence. To do this, many or all of the products featured here are from our partners. However, this doesn’t influence our evaluations. Our opinions are our own.

The best options brokers offer low options contract fees, quality trading tools, an abundance of high-quality research and the customer service necessary to support everyone from beginner investors to advanced traders.

While most of the brokers on our list of best brokers for stock trading would be a good pick for options as well, this list highlights brokers that excel in areas that matter most to options traders. Many of the below brokers also appear on our list of best online trading platforms for day trading.

Unsure what you’re looking for? See our post on how to choose an options broker and our options 101 guide for more on what can make or break an options trading experience.

Summary of Best Options Trading Brokers and Platforms of April 2020

Broker NerdWallet Rating
Commissions Promotion Account Minimum Learn More

cash credit with a qualifying deposit or transfer

on E*TRADE’s website

cash credit with qualifying deposit

on TD Ameritrade’s website

Interactive Brokers IBKR Lite

No promotion available at this time

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Binary Options Broker 2020!
    Good Choice for Beginners!
    Free Trading Education, Free Demo Account!
    Get a Sign-Up Bonus Now!

  • Binomo
    Binomo

    2nd in our ranking!

on Interactive Brokers’s website

no promotion available at this time

on Robinhood’s website

cash credit with a qualifying deposit

on TradeStation’s website

on E*TRADE’s website

E*TRADE

cash credit with a qualifying deposit or transfer

on E*TRADE’s website

cash credit with a qualifying deposit or transfer

Large investment selection.

Excellent customer support.

Access to extensive research.

Advanced mobile app.

Commission-free stock, options and ETF trades.

Website can be difficult to navigate.

on TD Ameritrade’s website

TD Ameritrade

cash credit with qualifying deposit

on TD Ameritrade’s website

cash credit with qualifying deposit

Commission-free stock, ETF and options trades.

High-quality trading platforms.

No account minimum.

Good customer support.

Large investment selection.

Costly broker-assisted trades.

on Interactive Brokers’s website

Interactive Brokers IBKR Lite

No promotion available at this time

on Interactive Brokers’s website

No promotion available at this time

Large investment selection.

Strong research and tools.

Over 4,300 no-transaction-fee mutual funds.

NerdWallet users who sign up for IBKR Pro get a 0.25 percentage point discount on margin rates.

Website is difficult to navigate.

Inactivity fees on IBKR Pro.

on Robinhood’s website

Robinhood

no promotion available at this time

on Robinhood’s website

no promotion available at this time

No account minimum.

No retirement accounts.

No mutual funds or bonds.

Limited customer support.

on TradeStation’s website

TradeStation

cash credit with a qualifying deposit

on TradeStation’s website

cash credit with a qualifying deposit

High-quality trading platforms.

Commission-free stock, ETF and options trades.

Active trader community.

Free trading on advanced platform requires TS Select.

No transaction-fee-free mutual funds.

Plans and pricing can be confusing.

Merrill Edge

cash credit with qualifying deposit

cash credit with qualifying deposit

Robust third-party research.

Integrated with Bank of America.

Advanced traders may find fewer securities on offer.

Want to compare more options? Here are our other top picks:

Last updated on April 2, 2020

Methodology

To recap our selections.

NerdWallet’s Best Options Trading Brokers and Platforms of April 2020

About the author

NerdWallet Compare, Inc. NMLS ID# 1617539

California: California Finance Lender loans arranged pursuant to Department of Business Oversight Finance Lenders License #60DBO-74812.

Disclaimer: NerdWallet strives to keep its information accurate and up to date. This information may be different than what you see when you visit a financial institution, service provider or specific product’s site. All financial products, shopping products and services are presented without warranty. When evaluating offers, please review the financial institution’s Terms and Conditions. Pre-qualified offers are not binding. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion® directly.

Best Options Trading Platforms for 2020

The StockBrokers.com best online brokers 2020 review (10th annual) took six months to complete and produced over 30,000 words of research. Here’s how we tested.

Next to active traders, there is arguably no customer more valuable to an online broker than an options trader. Options trades offer brokers much higher profit margins than stock trades, and, as a result, competition is fierce in attracting these clients. This type of market atmosphere is great for investors because with healthy competition comes product innovation and competitive pricing.

Best Options Trading Platforms

Here are the best options trading platforms, based on over 100 variables.

Best for options overall – Open Account
Promo Offer: Get $100 when you deposit just $5,000 into a new E*TRADE account!

Built as a web-based platform, Power E*TRADE innovates and delivers speed, ease of use, and the tools needed for traders to succeed. Once again, in our 2020 Review, Power E*TRADE won our award, “Best Web-Based Platform.” E*TRADE also took our top spot for options trading. Read full review

Low costs, great platform – Open Account
Promo Offer: Commission-Free Trades on Stocks, ETFs & Options Trades

As a trading technology leader, TradeStation shines. Options trading is a breeze using OptionStation Pro, a built-in tool within the TradeStation desktop platform designed for streamlined trading and robust analysis. Options tool capabilities include custom grouping for current positions, streaming real-time greeks, and advanced position analysis, to name a few. Read full review

Best options tools – Open Account
Exclusive Offer: Get up to $600 and trade commission-free with TD Ameritrade.

Once again, for the ninth consecutive year, TD Ameritrade is number one for trading platforms and tools, thanks to desktop-based thinkorswim. Whether day trading, options trading, futures trading, or you are just a casual investor, thinkorswim is a winner. Read full review

Best for professionals – Open Account
Exclusive Offer: New clients that open an account today receive a special margin rate.

Trading tools within the Trader Workstation (TWS) platform are designed for professional options traders. From algo trading to Options Strategy Lab, Volatility Lab, Risk Navigator, Market Scanner, Strategy Builder, and Portfolio Builder, Interactive Brokers is built for professionals. Options commissions start at $.65 per contract with a $1.00 minimum and no maximum. Read full review

Unique order types – Open Account
Current Offer: $0 online stock, ETF, and options commissions at Schwab.

Schwab’s flagship downloadable trading platform, StreetSmart Edge, provides most of the bells and whistles options traders and day traders need to succeed. For options traders, Schwab’s All-in-one trade ticket, alongside the proprietary Walk Limit order type, are both excellent. Read full review

Options Trading Tools Comparison

Feature E*TRADE
Open Account
Interactive Brokers
Open Account
TD Ameritrade
Open Account
TradeStation
Open Account
Option Chains – Streaming Yes Yes Yes Yes
Option Chains – Total Columns 30 37 33 32
Option Chains – Greeks 5 4 5 5
Option Chains – Quick Analysis Yes Yes Yes Yes
Option Analysis – P&L Charts Yes Yes Yes Yes
Option Probability Analysis Yes Yes Yes Yes
Option Probability Analysis Adv Yes Yes Yes Yes
Option Positions – Greeks Yes Yes Yes Yes
Option Positions – Adv Analysis Yes Yes Yes Yes
Option Positions – Rolling Yes Yes Yes Yes
Option Positions – Grouping Yes Yes Yes Yes
Platforms & Tools 4.5 4.5 5 5

Best Options Trading Tools

Platform wise, web-based Power E*TRADE offers all the tools an options trader could want, and displays them in magnificent form. Attention to detail, such as automatic spread groupings, effortless scanning through strategySEEK, and easy-to-understand risk/reward data through tradeLAB, make Power E*TRADE a truly unique experience.

Keeping the spotlight on excellent platforms and tools for options traders, TD Ameritrade’s thinkorswim and TradeStation cannot be left out. Strategy Roller from thinkorswim enables clients to create custom rules and roll their existing options positions automatically. The number of settings and depth of customization available is impressive, and something we have come to expect from thinkorswim.

Not to be outdone, TradeStation’s OptionsStation tool makes analyzing potential trades a breeze, and even goes as far as including 3D P&L charts. Investors note, however: Popcorn and 3D glasses are not required, and while visually appealing, we did not see any distinct advantage over the traditional 2D P&L chart.

If unique features and functionality matter to you, Charles Schwab offers the “Walk Limit” order type, which will “walk” your order to try to get the most favorable price within the National Best Bid or Offer (NBBO). The broker also offers Idea Hub, which uses targeted scans to break down options trade ideas visually.

For professionals, Interactive Brokers takes the crown. At Interactive Brokers, there is no base charge, and the per-contract rate is just $.70. Additional savings are also realized through more frequent trading. That said, the broker is built primarily for professional traders and requires a $100,000 minimum deposit for margin accounts. Lastly, its trading platform, Trader Workstation, is the most challenging platform to learn out of all the brokers we tested for our 2020 review.

There’s a healthy variety of reputable brokers to choose from in the world of options trading. At a minimum, investors should expect their broker to include scanning, P&L analysis, risk analysis, and easy-order management. Position management functionality and tying the experience together is where platforms such as Power E*TRADE and thinkorswim by TD Ameritrade distinguish themselves.

What is the best platform for trading options?

The best trading platform for options trading offers low costs, feature-rich trading tools, and robust research. Our all-around top pick in 2020 for options trading is Power E*TRADE. The web-based Power E*TRADE platform includes all the tools an options trader could want and displays them in magnificent form. My two favorites are strateySEEK and Snapshot Analysis.

What is a call option?

In its most basic form, a call option is used by investors who seek to place a bet that a stock will go UP in price. Buying a call option contract gives the owner the right (but not the obligation) to buy shares of stock at a pre-specified price for a pre-determined length of time. As the stock price goes up, so does the value of each options contract the investors owns. Each contract represents 100 shares of stock.

What is a put option?

In its most basic form, a put option is used by investors who seek to place a bet that a stock (or other security such as an ETF, index, commodity, or index) will go DOWN in price. Buying a put option gives the owner the right (but not the obligation) to sell shares of stock at a pre-specified price (strike price) before a preset date (expiration). The further the stock falls below the strike price, the more valuable each contract becomes.

What is the minimum amount required to trade options?

Each online broker requires a different minimum deposit to trade options. For most brokerages, the minimum deposit required is less than $1,000. To apply for options trading approval, investors fill out a short questionnaire within their brokerage account. Access to begin trading options can be granted immediately thereafter.

Is options trading risky?

Yes. Options trading is a form of leveraged investing. Any time an investor is using leverage to trade, they are taking on additional risk. Many times, this risk is unforeseen. With options, investors who buy a call or put risk the money they invested in the contract. However, when selling a call or put, if the trade isn’t protected (also known as going naked), then the investor is taking on significant risk. To protect investors, new investors are limited to basic, cash-secured options strategies only.

Options Trading Features

Ultimately, choosing an options brokers comes down to personal preference and weighing priorities, such as cost versus ease of use and tool selection.

On a feature by feature basis, all of our top five finishers this year offer the following features to their options trading customers.

Feature Definition
Has Education – Options Provides a minimum of 10 educational pieces (articles, videos, archived webinars, or similar) with the primary subject being options. All content must be easily found within the website’s Learning Center. Platform tutorials, FAQs, etc do NOT count.
Option Chains – Streaming Real-time Option chains with streaming real-time data.
Option Chains – Greeks Viewable When viewing an option chain, the total number of greeks that are available to be viewed as optional columns. Greeks = delta, gamma, theta, vega, rho.
Option Chains – Quick Analysis The ability to jump straight from the option chain to a P&L chart or probability chart for deeper analysis. Viewing a summary P&L within the chain itself also qualifies.
Option Analysis – P&L Charts When analyzing a theoretical option trade, a P&L chart is available.
Option Analysis – Probability Analysis A basic probability calculator.
Option Analysis – Probability Analysis Adv A tool to analyze a hypothetical option position. Displays a probability histogram / chart with optional customizations.
Option Positions – Greeks Viewable View at least two different greeks for a currently open option position.
Option Positions – Greeks Viewable Streaming View at least two different greeks for a currently open option position and have their values stream with real-time data.
Option Positions – Advanced Analysis Ability to analyze an active option position and change at least two of the three following conditions – date, stock price, volatility – and assess what happens to the value of the position.
Option Positions – Rolling Ability to pre-populate a trade ticket and seamlessly roll an option position to the next relative expiration.
Option Positions – Strategy Grouping Ability to group current option positions by the underlying strategy: covered call, vertical, etc. Can be done manually by user or automatically by the platform.
Level 2 Quotes – Options Level II options quotes available.
Screener – Options Offers a options screener. Commonly referred to as a spread creation tool or similar.

Explore our other online trading guides:

Methodology

For the StockBrokers.com tenth annual best online brokers review published in January 2020, a total of 3,540 data points were collected over six months and used to score brokers. This makes StockBrokers.com home to the largest independent database on the web covering the online broker industry.

Participation is required to be included. Each broker completed an in-depth data profile and provided executive time (live in person or over the web) for an annual update meeting. Our rigorous data validation process yields an error rate of less than .001% each year, providing site visitors quality data they can trust. Learn more about how we test.

Still aren’t sure which online broker to choose? Email us a question! Whether you are a beginner investor learning the ropes or a professional trader, we are here to help. Email us your online broker specific question and we will respond within one business day.

Best Options Trading Platforms

The best options brokers have a wealth of tools that help you manage risk

Investopedia is committed to rigorous editorial standards to provide our readers with the best advice and recommendations. We may receive compensation when you click on links to products we reviewed. Learn more about our methodology and review process.

We recognize that we all are living through a particularly volatile time as we deal with this global crisis, and financial markets have also seen unprecedented change, impacting all investors. Our mission has always been to help people make the most informed decisions about how, when and where to invest. Given recent market volatility, and the changes in the online brokerage industry, we are more committed than ever to providing our readers with unbiased and expert reviews of the top investing platforms for investors of all levels, for every kind of market.

Options trading has become extremely popular with retail investors since the turn of the 21st century. Our best options brokers have a wealth of tools that help you measure and manage risk as you determine which trades to place. They also include valuable education that helps you grow in sophistication as an options trader.

Best Online Brokers for Options Trading in April 2020:

  • tastyworks: Best Options Trading Platform
  • tastyworks: Best Broker for Advanced Options Traders
  • tastyworks: Best Broker for Mobile Options Traders
  • E*TRADE: Best Broker for Beginning Options Traders
  • eOption: Best Broker for Low-Cost Options Trading

Best Options Trading Platform, Best for Advanced Options Trades, and Best for Mobile Options Traders: tastyworks

  • AccountMinimum: $0
  • Fees: $0.00 stock trades, $1.00 to open options trades $0.00 to close

Tastyworks says that more than 90% of the trades placed by its customers are derivatives, so they naturally spend their time designing a lot of tools specifically for options and futures traders. Everything is designed to help traders evaluate volatility and the probability of profit. Tastyworks’ entire platform is geared towards making decisions and taking action. Tastyworks opened its virtual doors in 2020, so it isn’t saddled with legacy systems that bog down many of the older online brokers. This has helped it tremendously in keeping the options trading experience to the essentials. Tastyworks’ executions are fast and the costs are low, with commissions capped for opening orders for options on equities and futures at $10 per leg.

Watchlists are a key component of the tastyworks platform, and they are the same on mobile, web, and download. The look and feel of the mobile platform is very similar to the desktop versions, though you’ll find price wheels and ways to define trades that minimize the possibility of making a mistake. As you build a position from a chart or from a volatility screener, a trade ticket is built for you. There’s also a video viewer embedded so you can keep an eye on the tastytrade network. Though a newcomer to options trading might be initially uncomfortable, those who understand the basic concepts will appreciate the content, features, and focus apparent throughout tastyworks’ platforms.

All of the tools you’ll need for analyzing and trading derivatives are built into the platforms.

The charting capabilities are uniquely tuned for the options trader. If you have multiple positions on a particular underlying, you can analyze the risk profiles of the combined position.

There are hours of original video from tastytrade every weekday, offering up-to-the-minute trading ideas, plus a huge library of pre-recorded videos and shows.

Newcomers to trading and investing may be overwhelmed by tastyworks at first.

There is no fixed income trading (outside of ETFs that contain bonds) for those who want to allocate some of their assets to a more conservative asset class.

Any additional portfolio analysis beyond profit and loss requires setting up a login on a separate site, The Quiet Foundation, which is also part of the tastytrade empire.

Best for Beginning Options Traders: E*TRADE

  • AccountMinimum: $0
  • Fees: No commission for stock/ETF trades. Options are $0.50-$0.65 per contract, depending on trading volume.

New options traders need some help in understanding how trading derivatives can help improve portfolio returns. E*TRADE’s more advanced platforms are elegantly designed and guide you along the way. When you graduate to options and derivatives, the Power E*TRADE website and mobile app can help you learn. The Power E*TRADE site and app can be set up to put the functions you use most often front and center so you don’t have to dig around for them. The platform has all the features inherited from E*TRADE’s acquisition of OptionsHouse technology, which includes a wealth of helpful educational resources for the developing options trader. Watchlists are integrated across E*TRADE’s platforms, and the full range of tradable assets is accessible on the mobile apps. The workflow is very smooth on the mobile apps. We also found that using Power E*TRADE on a tablet is quite pleasant.

Mobile apps are extremely well laid-out and easy to use and are among the most comprehensive and extensive apps tested.

Spectral Analysis on Power E*TRADE is a visually stunning tool that helps you visualize maximum profit and loss for an options strategy and understand your risk metrics

You can test strategies using the paper trading capabilities of E*TRADE Pro’s desktop platform, which uses delayed data so you won’t think you’re placing real trades.

On all platforms, you’ll find a ubiquitous trade ticket with streaming real-time data.

Tiered commission schedule for options trades, charging $0.65 per contract for less frequent traders and $0.50 for those who place more than 30 options trades per quarter.

Investors who would like direct access to international markets or to trade foreign currencies should look elsewhere.

You cannot consolidate your externally-held accounts to form a complete picture of your net worth on E*TRADE.

Best for Low-Cost Options Trading: eOption

  • Account Minimum: $0
  • Fees: $0 per stock/ETF trade, $1.99 base per leg plus $0.10 per contract for options trades

eOption charges $1.99 per leg for options trades, but the per-contract fee is significantly lower than its competitors, making it great for heavy options traders. eOption also offers commission-free stock and ETF trading so those who are options-oriented traders but also want access to other assets at a low cost will have no issues here. Clearing and exchange fees, typically a fraction of a penny per share, are spelled out on the order confirmation screen and are passed through to customers. eOption also scored highly for its relatively low margin rates.

eOption offers great value for frequent options traders.

The browser-based eOption Trader platform is easy to use.

Newsletter subscribers can auto-trade their alerts.

Limited education offerings.

News feeds are limited.

Any OTCBB (penny stock) trades must be made with a live broker.

Other Options Considerations

The commission structure for options trades tends to be more complicated than its equivalent for stock trades. Until the commission cuts that swept the industry in the fall of 2020, most brokers charged a fee for each leg of an options spread plus a commission per contract being traded. The per-leg fees, which made 2- and 4-legged spreads expensive, have been eliminated industry-wide, for the most part. We are also seeing some brokers place caps on commissions charged for certain trading scenarios.

Investors with fairly large portfolios can also take advantage of portfolio margining at some brokers. This is a practice that assesses the total risk inherent in a portfolio that contains stocks and derivatives. Investors with large portfolios can use portfolio margining to reduce the size of the margin loan.

What Kind of Options Trader Are You?

The first and most important piece of information to consider before selecting an options trading account is what kind of trader you are. What is your trading style and risk appetite? Which tools would you like to have handy?

Options are complex products to understand and trade. All of the brokers listed above allow customers to build complex options positions as a single order. Some brokers, such as Vanguard, only allow one position per order, leaving it to the individual trader to place multiple orders one at a time to create a combination position. Merrill Edge lets you place two-legged spreads, but anything more complex will require an additional order.

If you’re just getting started with options trading, the quality of education and help offered by your broker is important. Frequent traders and those who trade a large number of contracts will be more sensitive to commissions and fees, so check out your prospective broker’s charges and make sure you understand them.

Methodology

Investopedia is dedicated to providing investors with unbiased, comprehensive reviews and ratings of online brokers. Our reviews are the result of months of evaluating all aspects of an online broker’s platform, including the user experience, the quality of trade executions, the products available on its platforms, costs and fees, security, the mobile experience and customer service. We established a rating scale based on our criteria, collecting thousands of data points that we weighed into our star-scoring system.

In addition, every broker we surveyed was required to fill out an extensive survey about all aspects of its platform that we used in our testing. Many of the online brokers we evaluated provided us with in-person demonstrations of its platforms at our offices.

Our best options brokers have a wealth of tools that help you measure and manage risk as you determine which trades to place. These brokers include valuable education that helps you grow in sophistication as an options trader. Investors with fairly large portfolios can take advantage of portfolio margining at certain brokers, a practice that assesses the total risk inherent in a portfolio that contains stocks and derivatives, and can reduce the size of your margin loan.

Our team of industry experts, led by Theresa W. Carey, conducted our reviews and developed this best-in-industry methodology for ranking online investing platforms for users at all levels. Click here to read our full methodology.

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Binary Options Broker 2020!
    Good Choice for Beginners!
    Free Trading Education, Free Demo Account!
    Get a Sign-Up Bonus Now!

  • Binomo
    Binomo

    2nd in our ranking!

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