Review optionshouse brokerage

OptionsHouse: A Review for Options Trading.

Is OptionsHouse the best choice for stock options traders? Let's review this popular discount broker, with a focus on commissions, functionality, and other OptionsHouse account features.

For many discount brokers, stocks and funds are the main breadwinner, and stock options are just a sideshow. Before opening a new brokerage account, options investors should be especially thorough in shopping for a brokerage, as options trading capabilities, commissions, and research vary wildly throughout the industry.

Let's review how OptionsHouse stacks up for options investing and dig into the details you should know before opening an account.

OptionHouse's commission prices.

Let's start with one of the most important factors of choosing a broker: how much it costs to place a trade. OptionsHouse uses a standard commission schedule in which its clients pay a base rate per trade plus $0.50 for each options contract.

Stocks and ETFs.

$4.95 per trade + $0.50 per contract.

Data source: company website.

Keep in mind there is often more to a broker's commission schedule than just its published prices, which we'll explore in more detail. Importantly, new customers can frequently qualify for sign-up bonuses and commission-free trades when they open a new account. Learn more about special offers for new accounts to see if you qualify.

Multi-leg options and exercise and assignment fees.

Some investors simply buy and sell calls and puts. Others write covered calls for income. And a smaller number of investors use complex options strategies that involve buying and selling multiple contracts simultaneously. OptionsHouse caters to all types, as it offers basic options trading capabilities, as well as the ability to place multi-leg options trades for complex options trading strategies.

Type of Transaction.

Fees and Commissions.

Up to 4 legs (one $4.95 base commission)

Fee for low-price options.

Free for options priced at $0.10 or less.

Data sources: company website, Barron's .

OptionsHouse commissions are favorable for those who use complex trades because it doesn't charge its $4.95 base fee on each leg of a trade. Thus, an options trader could complete a long straddle trade to simultaneously buy one put and one call contract for a price of $5.95 ($4.95 plus $1.00 for two contracts).

Importantly, OptionsHouse also waives commissions to close low-priced options contracts when the options price is $0.10 or less. This can be advantageous, as commissions are especially onerous on low-priced options contracts (a fee of $0.50 per contract equates to a 5% commission rate on options priced at $0.10 each).

Commissions for each leg on a multi-leg trade can make for a frustrating experience. OptionsHouse charges just one base rate on a multi-leg trade. Image source: Getty Images.

Options research tools.

Discount brokers rose to popularity by eliminating many of the costly services of full-service brokers, enabling them to pass on the savings to their customers in the form of lower commissions. As time goes on, though, discount brokers are increasingly offering more research and trading tools to their clients free of charge.

OptionsHouse caters to options traders (hence its name) and thus many of its tools are designed with a focus on options. The company's proprietary tradeLAB tool enables its clients to view options strategies graphically, charting the the maximum gain, loss, and break even point of a particular trade. Its strategySEEK tool can be used to comb the market for trading opportunities, and find trades to make based on factors like return potential, safety, probability, and potential profit. Depending on your needs, OptionsHouse probably has a tool for you.

Minimum deposit requirements for options trading.

OptionsHouse doesn't have a minimum deposit requirement to open a new account, so you don't need to worry about having to empty your savings account to get started. That said, some strategies that expose investors to elevated risk (like shorting puts or calls) will require a higher balance depending on the trade size. All brokers have risk-management parameters in place to reduce the risk that a trader creates a loss so large that it exceeds his or her account balance.

Review: OptionsHouse for options trading.

Realistically, there isn't any one broker that is best for all option traders, but there is a broker that is a best fit for any given investor.

Some investors may like that OptionsHouse offers competitive commission prices, particularly for multi-leg options trades, as well as the fact that its trading and research tools are all designed with a focus on options trading first and foremost. That said, those who trade options less frequently than they invest in stocks or funds may not make full use of its functionality, or may prefer brokers that offer more commission-free ETFs, for example. To be clear, The Motley Fool does not endorse any particular brokerage, but we can help you find one that is a good fit for you. Check out the Fool Broker Center to compare several brokers all on one page and to see if you qualify for extra perks just for opening an account.

I think stock investors can benefit by analyzing a company with a credit investors' mentality -- rule out the downside and the upside takes care of itself. Send me an by clicking here, or tweet me.

OptionsHouse Review.

Established in 2005 and backed by one of the countries largest options trading conglomerates, Peak6 Investments, Chicago-based OptionsHouse is considerably new to market. Having established itself while riding in on the technology wave, OptionsHouse from the start has positioned itself as a market leader with its powerful platform offerings and sophisticated trading tools.

Following the adage “it’s not how much you make, it’s how much you keep,” OptionsHouse has priced it’s services for the active trader. Competitive commissions and low per-contract fees ensure a win-win situation in that the more you trade the more you save and conversely the more you trade (and save) the more OptionsHouse takes.

Much like the Canadian online brokerage firm Questrade, OptionsHouse offers flexible pricing for options, enabling investors to tailor their pricing strategy to their trading propensities.

Compared side-by-side to other discount and full service brokerage firms, OptionsHouse is cheap.

It cost $4.95 to trade stocks.

No frills, no hoodwinks, no hidden fees, just $4.95. $4.95 stock trades are cheap for even the discounted brokerage firms. Often times we see with cheap pricing comes sacrifice, whether its poor customer service, lacking research tools and/ or dated and slow platforms. With OptionsHouse you get a great price and industry leading technologies.

OptionsHouse is called OptionsHouse for a reason: because of their competitive commission plans for options trading and options contracts.

OptionsHouse offers two different pricing models:

For the less-active trader - the 5 for 5 plan. Single-leg options, $5 bucks for the first 5 and a dollar a contract thereafter. Active options trader - the high volume plan. $8.50 & $0.15 per single-leg contract order.

OptionsHouse offer two (2) price commissions on spreads as well:

The 10 for $10- and $1/ contract thereafter $12.50 + $0.15/ contract.

**Important to note that OptionsHouse does support thousands of mutual funds, so only about 30% of them can be traded on the platform without redirecting to a third party vendor.

Mutual funds trade $9.99.

Trading Platform.

OptionsHouse just finalized its merger with TradeMONSTER, and the trading platform has migrated over to TM. Existing account holders will see the same fee structure and options, just on the TradeMONSTER Platform. For the sake of this section, TradeMONSTER and OptionsHouse can be used interchangeably.

OptionsHouse trading platforms are superior in many ways to the competition for the following reasons:

To the dismay of some expert traders, OptionsHouse offers only a browser-based version of their platform. If you require advanced desktop options, you may have to look to other brokerage firms, however its probably worth giving it a shot.

With features like all-in-one ticket orders, OptionsHouse platform is intuitive, customizable and efficient.

What separates their user experience from many others? Its fast.

Everything in OptionsHouse is designed to execute with precession and speed. This is the reason they offer only a web-based architecture. Plus it makes it easier to maintain and control from their end.

Streaming quotes, data, market news and an integrated trade ticket ensure that everything needed to make decisions and physically execute trades is a click or two away.

Its customizable, meaning the interface is designed by you to fit your needs. Fully changeable layouts, flexible views, multiple chains and adjustable widgets give you the user a personalized experience.

If it sounds like I’m selling their platform, its because its that good.

Ok, so the platform is powerful and accelerated, how about their trading tools? After all, the entire portal can be well designed to allow for perfect flow, but if access to information is bogging you down, then what’s the point?

Lets take a look at OptionsHouse plethora of powerful trading assets:

Volatility Charts – implied and historic analysis Probability Calculators – Enter a symbol, place a target price and calculate probability Stock Screener – Personal criteria selections enable stock screener to recommend investments that may fit your style Profit and Loss Calculator (P&L) Live stream – Charts, market data and news OptionsHouse Risk Score – proprietary algorithms designed to assess and analyze your portfolio risk Different types of risk Risk mitigation 1-10 rating system Valuable risk management even for the laymen Risk Viewer – More risk algorithms Spread Investigator – Scans equity options for call and put options with high theoretical returns.

And if you are new to trading, test your skills, learn strategies and execute trades at no risk with OptionsHouse’s Virtual Trading .

OptionsHouse Mobile.

Barron’s 2014 gave OptionsHouse 4 ½ out of 5 for their mobile applications.

OptionsHouse reign of platform superiority does not end with their web portal. Stay connected to your accounts while executing trades on the go with OptionsHouse mobile applications available for iPad, iPhone, Kindle Fire, Android phones and Android tablets.

A very similar user experience found with the web portal can be felt on the OptionsHouse mobile applications.

Retirement Plans.

Although seemingly kept on the backburner, OptionsHouse does offer the usual retirement accounts just as the full service brokerage houses do. Just because a major emphasis isn’t placed on their retirement options, OptionsHouse does provide most options you would seek.

It is important at this juncture to keep things in perspective. OptionsHouse is a lean trading machine, and to revert too much attention to other “full-service” aspects of the financial sector would be to stray away from its fundamental core competency.

What does this mean to you, the investor?

If you are an active trader, looking to capitalize on OptionsHouse low trading fee structure and want to keep some other retirement accounts under the same roof, then OptionsHouse will be perfect for you.

If you are NOT an active trader, looking primarily to find a financial institution to start plugging money away for the long-term, and have very little interest in actively trading stocks or options, then OptionsHouse is not for you.

Banking Features.

Here is where OptionsHouse is seen separating itself from its full-service counter part, banking.

Basic banking services like checking and saving accounts are available, however require account minimums of $10,000. In addition, the accounts must hold at all times that minimum of $10,000. If you are able to comply with these standards you are able to save, write checks against and transfer monies from investment accounts to bank accounts. If not, you will need to bank elsewhere.

Customer Service.

Not much to say on OptionsHouse customer service. The web doesn’t have an overwhelming vendetta against and them, and that says a lot.

I conducted some research to determine my own opinion on OptionsHouse customer service…

I fired up their live chat functionality, which is not reserved strictly for account holders. Within seconds someone by the name of Mike had greeted me and asked how he could assist. I struck up a conversation as if I had basic retirement account and trading questions. The more I asked ridiculous questions, the more polite Mike got, and by the end of it had intelligently answered all of my questions.

So, in conclusion, OptionsHouse live chat capabilities, even for non-account holders, did not disappoint.

OptionsHouse provides a steady stream of available, free webinars, again not reserved only for account holders. Without being logged into my account I was able to register for upcoming webinars as well as simply watch past webinars right on the OptionsHouse website.

In addition to live webinars, access to live chat and , OptionsHouse is of course available by phone (7am-7pm Central Time).

Dial Toll Free – 877-653-2500 Outside the US – 1-312-279-9970.

All things considered, OptionsHouse provides customer service to back its superior product offerings.

Bottom Line.

OptionsHouse is often called a discount brokerage house, which makes sense when reviewing price. However upon close inspection, they seem to behave more like the full-service competition (like TD Ameritrade and Fidelity).

If you’re an active trader you should consider OptionsHouse as your home base.

Review Information.

About Eric Stauffer.

I am a former insurance agent and banker turned consumer advocate. My priority is to help educate individuals and families about the different types of insurance they need, and assist them in finding the best place to get it.

OptionsHouse Review.

OptionsHouse is fantastic for options trading, providing investors with industry-leading tools and extremely competitive commission rates.

By Blain Reinkensmeyer / February 21st, 2017 / Updated: September 12th, 2017.

Review Sections:

IMPORTANT NOTICE JULY 2017: OptionsHouse is now a part of E*TRADE. Please read our E*TRADE Review for a full breakdown of the combined brokerage.

OptionsHouse has come a long way. After its establishment in 2005, the online broker grew until May 2014 when it was announced the company and tradeMONSTER would be coming together under one roof. OptionsHouse was best known for its highly competitive commission rates, while tradeMONSTER was known for its terrific web-based options trading platform.

From 2014 until the summer of 2016, the combined OptionsHouse brand thrived, ultimately being purchased by ETRADE for $725 million. At the time this review went to press in February 2017, OptionsHouse continued to run as a stand-alone entity and brand, doing what it has always done best, providing clients fantastic options tools with highly competitive commissions.

Commissions & Fees.

Stock trades are a flat rate of $4.95 per trade and options trades are just $4.95 + $.50 per contract. This flat-rate commission structure is significantly less expensive than those of all the large, full-service brokers, such as TD Ameritrade, Charles Schwab, and Fidelity.

What we also deeply appreciate is that OptionsHouse’s structure is clean cut, with little or no gimmicks or special-case scenarios that can ramp up costs in a hurry.

In fact, when you break these rates down against the entire industry, OptionsHouse finishes No. 2 overall behind Interactive Brokers. For equities and options traders this is a seriously competitive commission structure that cannot be overlooked. What we also deeply appreciate is that OptionsHouse’s structure is clean cut, with little or no gimmicks or special-case scenarios that can ramp up costs in a hurry. No platform fees or data fees either – the rates are all inclusive.

To provide its active options trading customers with an even better deal, OptionsHouse kicked off 2016 by implementing a new Dime Buyback program, under which the company removed commission charges tied to closing short options contracts of $.10 or less, no matter what the spread type is. For example, if a customer makes a two-legged options trade and one leg was a buyback for $.10 or less, the second leg commission would be reduced to $0.

Platforms & Tools.

OptionsHouse competes with the best in the industry when it comes to powerful platforms for trading options. Built as a web-based platform, OptionsHouse innovates and delivers speed, quality, ease of use, and the tools needed for options traders to succeed.

For newer investors, there isn't a better platform on which to learn how to trade options.

OptionsHouse offers both virtual trading and regular trading. For newer investors, there isn't a better platform on which to learn how to trade options. Pulling up quotes is a breeze, and OptionsHouse makes it easy to file personal notes with each trade.

Regarding OptionsHouse’s streaming charts, the functionality is good but there are drawbacks. First, the interface is not user-friendly and, compared to other brokers, it took us significantly longer to become acquainted with making customizations. Second, there are limited tools (just nine) with which to mark up charts. Third, there is a lack of technical studies available – only 35, compared to the industry average, which is close to 100. This extends to study customizations, which we also found to be limited.

On the plus side, you can place limit orders on the chart itself, then access a pre-filled order ticket to review and submit the trade. OptionsHouse also allows you to view your past buys and sells right on the chart, a feature few other brokers offer.

Moving onto options capabilities, OptionsHouse shines. The option chain screen displays a fully customizable streaming real time option chain with 30 different optional columns, including every greek.

Once you find an option of interest, clicking it pops open OptionsHouse’s summary window, which includes key metrics alongside different quick links for further analysis. Click Analyze and the tradeLAB Snapshot Analysis pops open. Not only is Risk/Reward completely broken down with simple smiley faces to translate the pros and cons, but key events to watch out for are displayed alongside a P&L chart. It’s a work of art.

If that isn’t good enough, OptionsHouse then provides a Spectral Analysis, which includes all the data needed to make an informed decision. My favorite feature on this tab is Risk Metrics, which displays the option greeks. Since not all investors understand greeks, OptionsHouse has a simple pull-down menu to change from "Greek" to "English," making the data user-friendly for new investors. Awesome.

Once you have finished analyzing, you can quickly import the data into a fresh trade ticket, use the trade calculator to find the right position size, add optional notes, and then place the trade. (Note: This intuitiveness with design and UI continues beyond researching and placing trades. All live positions are completely customizable. OptionsHouse automatically groups options into spreads for you, then allows you to completely regroup them and customize them to your liking using a simple drag-and-drop interface.)

Even with all these capabilities, the highlight for options remains the strategySEEK tool, which is where you will find the platform’s option screener. strategySEEK is hands down the best options scanner in the industry.

Even with all these capabilities, the highlight for options remains the strategySEEK tool, which is where you will find the platform’s option screener. strategySEEK is hands down the best options scanner in the industry. First, you forecast the price at which you think the stock might end up down the road. Next, you drag and drop to set and order your priorities for the trade: Profit, Return, Probability, and Safety. Lastly, you click “Show Strategies” for a list of the best possible matches. From here, you can create an order and place the trade, analyze the trade (see above), or adjust the scanner and rerun.

It isn’t just the interface that makes strategySEEK impressive, it’s also the data and behind-the - scenes calculations taking place to power the tool’s recommendations. The OptionsHouse platform calculates EVERY possibility, millions of them, using a plethora of data, and displays results in milliseconds. This attention to detail is also seen throughout the rest of the platform in tools such as the liveACTION scanner.

All in all, the arsenal of tools available to options traders is truly impressive. OptionsHouse has a clear understanding of what options traders want, and delivers it in stunning fashion. And, as far as equities trading goes, while the platform has a strong foundation of functionality, the overall trading experience could be better. This is especially true for the charting interface, which needs an overhaul. That said, when it comes to browser-based platforms, options trading, and ease of use for new investors, OptionsHouse is king.

On the right sidebar of the Quote screen is OptionsHouse’s take on stock research, which is a breakdown of company information and fundamentals. OptionsHouse offers its own Fundamental Report Cards for each company, which, until October 2015, also included letter-relative ratings. While I applaud the OptionsHouse platform team for thinking outside the box, I found the data difficult to interpret and unimpressive.

With such competitive commissions, OptionsHouse must cut somewhere, and research is where the broker shaves cost.

Beyond the Fundamental Report Cards, not much else is offered. There are no third-party research reports, no way of conducting metric comparisons against other companies, no SEC filings, and you cannot even view a simple balance sheet. With such competitive commissions, OptionsHouse must cut somewhere, and research is where the broker shaves cost.

Similarly for ETFs and Mutual Funds research, the experience is poor. The data is very limiting and the only real positive is being able to see a Morningstar star rating for both ETFs and mutual funds. OptionsHouse is not recommended for research-hungry investors.

Mobile Trading.

In late 2016, OptionsHouse released a brand-new mobile experience, completely rebuilt from the ground up. In prior years, OptionsHouse’s mobile apps suffered in the speed department because of their HTML 5 core. Thankfully, speed is no longer a worry and the broker now has a fantastic foundation to build from.

Looking at the features of the new experience, on the plus side, the app has the strong core functionality traders desire: real-time streaming quotes, excellent position management capabilities, and synced watch lists. The app also enables traders to place basic and complex options orders, view post-hours charts, and more. OptionsHouse also ties in some creative design elements, such as a fanning out the five most recent quotes when you tap on “Quote” on the bottom bar.

On the cons side, the app is still so new there are features missing that are still under development and awaiting release later in 2017. When looking at stock charts and trying to perform technical analysis, you cannot rotate the screen horizontally to view the chart cleanly. Studies are fairly limited at 11 (although they can be deeply customized, which is nice) and there are no tools beyond pinching to zoom in and out. OptionsHouse has left its previous app in the app store for this reason, which makes sense.

All data considered, while OptionsHouse clients are stuck using two separate app experiences until the new app is fully featured, the mobile offering is still great. OptionsHouse placed fourth out of 16 brokers.

Other Notes.

OptionsHouse delivers customer service that is on par with industry standards. The broker is certainly not industry leading, finishing eighth overall, but it delivers a quality experience that should appease most clients.

Also not covered in my review commentary is OptionsHouse’s educational resources. While these resources improved in 2016 with the addition of webinars and more educational content on the company’s blog, OptionsHouse still lacks across the board. Education is limited to just options, there are no videos, organization is poor, and there is a lot left to be desired.

Final Thoughts.

OptionsHouse has proved to be a terrific home for options traders over the years. There was no better confirmation of OptionsHouse’s dominance than the firm’s acquisition by ETRADE for $750 million in July 2016.

For now, OptionsHouse remains a stand-alone brand that continues to do what it does best. While it is weak in its offering of education, research, and tools catering to active stock traders specifically, OptionsHouse is on par with the industry with its customer service and shines everywhere else. For options trading, OptionsHouse is No 1, thanks to its discounted pricing structure and industry-leading tools.

Methodology.

For our 2017 Stock Broker Review we assessed, rated, and ranked sixteen different online brokers over a period of six months. In total, we conducted 349 customer service tests, collected 5,277 data points, and produced over 40,000 words of research. How we test.

OptionsHouse Review 2017.

Editor’s Note: E-Trade has acquired OptionsHouse. Current OptionsHouse customer accounts, assets and positions will be moved to E-Trade on August 4-6. (For more details visit E-Trade’s FAQ.) See NerdWallet’s E-Trade review.

Sophisticated investors — particularly options traders (no surprise) — get a lot of broker for very little money with OptionsHouse. The firm’s low-cost commissions ($4.95 a trade for stocks and options), $0 minimum to open and maintain an account, and professional-grade research, trading tools and platform earn it NerdWallet’s five-star rating. That said, OptionsHouse is not a one-size-fits-all brokerage solution; mutual fund and exchange-traded fund investors can find a much better fit for their needs elsewhere.

NerdWallet's rating: 5.0 / 5.

Quick facts.

Commissions: $4.95 flat rate Account minimum: $0 Promotion: $1,000 in free trades with deposit of $5,000 or more.

OptionsHouse is best for:

Options traders Advanced traders Fee-conscious traders No account minimums or inactivity fees Premium platform and tools.

OptionsHouse investments at a glance.

Where OptionsHouse shines.

Account minimum and fees: OptionsHouse scores big points for requiring no minimum balance to open an account. Even better — and this is a standout among brokerages that cater to active traders — the company charges no maintenance fees to customers who fail to make a certain number of trades per month or year. Similarly, customers pay nothing extra for the platform or data.

Options trading platform and tools: OptionsHouse started as a broker for experienced, self-directed investors who were active in options, and it still offers professional-grade tools and execution at a low price.

The company’s merger with TradeMonster in late 2014 and full integration in 2015 made a big impact, with OptionsHouse taking on that company’s highly regarded web-based trading platform. It’s designed for fast and easy trade execution. From the trade ticket, users can quickly make changes, walking through trade ideas where everything is customizable.

TradeLAB gives investors a profit/loss/break-even snapshot on a single screen as well as the probability of any profit, based on the current stock price and the current implied volatility. Within tradeLAB, investors can play out “what-if” scenarios for every angle they can come up with.

The platform also has significant automation capabilities, including trigger alerts that allow users to pre-populate orders. The platform then pushes an alert to the user when an event is triggered. Investors can then submit already-saved orders directly from the web or via the OptionsHouse mobile app.

Another standout tool is strategySEEK, which helps investors scan live market data for options strategies based on specific criteria. The tool turns up a list of matches, allowing the user to quickly create an order, using the above features to analyze the trade within the ticket.

On-the-go investors will appreciate that OptionsHouse’s trade platform is browser-based. Any customizations the user makes are saved in his or her profile and available no matter what device is used to access the account.

Virtual trading platform: Paper trading (virtual trading without putting real money on the line) is a nice perk for new traders and new-to-the-platform investors. Once customers open a real account (which, remember, has no minimum funding requirement), they can set up a paperTRADE account that mirrors all of the live trading platform’s bells and whistles. Through paperTRADE, investors can get hands-on practice trading virtual currency in a live market environment — a perk that makes OptionsHouse stand out among its peers.

Where OptionsHouse falls short.

Commission-free ETFs: Having only five commission-free ETFs is disappointing, but not unusual in the realm of discount brokerages. Active ETF investors who want to keep commission costs down should consider OptionsXpress or TD Ameritrade’s ETF lineups.

How OptionsHouse stacks up.

OptionsHouse offers some of the lowest commissions and fees, making it one of the most affordable choices in its competitive set. Its advanced tools and fast trade executions, along with a full-service platform, make it well-suited for options traders.

OptionsHouse vs. similar brokers.

The bottom line.

Although OptionsHouse is not the right fit for mutual fund and ETF investors, it’s hard to beat when it comes to serving options traders and active stock investors at every experience level. Rock bottom commissions (just $4.95 a trade for stocks plus 50 cents per contract for options), $0 account minimum, lack of hidden fees, speedy trade execution and free pro-level investing tools and trading platform are why OptionsHouse continues to show up on our best-of lists.

Dayana Yochim is a staff writer at NerdWallet, a personal finance website. : dyochimnerdwallet. Twitter: dayanayochim.

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