Finding the best options trading platform is an important first step to begin options trading. An options trading platform can make or break a trader. Some of the best options brokers are TastyWorks, TradeStation, and TD Ameritrade. You may be asking what makes a platform the best one. It all depends on what you prefer as a trader. Do you want a platform with the cheapest commissions? Would you rather have good trading tools, design, and customer service? Those are some questions to consider as you research which options trading platform would work best for you.
Best Options Trading Platforms and Brokers
Here are some of the best options trading platforms:
There are some things to consider when you’re looking for the best options trading platform. Options trading can be complicated. There’s definitely more involved with an option than stock trading. Choosing a broker you like allows you to practice and research as well as place and track trades.
If you’re new to options trading, you may want to find a broker that includes fee education with their platform. This can include free online trading courses, webinars, and one-on-one guidance, whether online or on the phone. The best advice out there is to spend time as a student.
Easy to Use Platforms
When choosing the best options trading platform, you want a broker that is easy to use. The platform itself should be user-friendly. You wouldn’t want to sign up for a platform you hate. You wouldn’t be excited to trade every day.
Again, this is where simulated accounts come in handy. Not only do they allow you to practice, but you can also see firsthand if this is a platform you’d want to use.
Are the tools you need easy to find, or are you constantly having to hunt for them? Is placing an order easy? Is there a difference between a market order and a limit order? Does it allow you to create alerts and have a mobile platform?
If you can’t be in front of a computer but still want to trade, you want a broker with a good, user-friendly mobile platform. Trading apps have come a long way and are a great way to trade on the go.
You also want a broker that allows alerts. Alerts can be set to be sent to your phone through text or email, which in turn allows you to go to your mobile app to place the trade.
You’ll want a reliable platform that fills orders quickly. The frustration of not getting an order filled on time and missing a move is real. If you’re day trading options for income, you need a platform that fills and closes orders as quickly as possible.
Commissions
Commissions are something people take into account when choosing the best options trading platform. They aren’t as important as the things listed above. Having a fantastic broker and maybe paying a little more is ok.
Of course, you can always call your broker and see if they’ll lower it. Thinkorswim is usually great about that. Yes, smaller commissions mean keeping more of your profit, but there’s another side to that.
Low-commission brokers can offer those rock-bottom prices because their platforms have the bare minimum in trading tools. Sure, you may pay a little more for a larger broker, but you also have access to a whole lot more. A few different brokers offer options trading: Thinkorswim, Fidelity, and Charles Schwab, to name a few. Thinkorswim has an excellent platform, a fantastic simulated account, and bar none customer service. You also don’t need a minimum account to open one.
Charles Schwab also offers a great platform, has great customer service, and an easy-to-use options platform. However, you do need a minimum of $1,000 to open an account.
Fidelity is another popular broker. While known mostly as a retirement broker, it does have a good trading platform and research tools. You need a minimum of $2,500 to open an account.
Interactive Brokers also has options trading. They may be known primarily as a day trading platform, but they also offer options for day trading. You do need a minimum of $10,000 to open an account.
TastyWorks Options Trading Platform
Broker Geared Towards Profits
TastyWorks’ entire platform is geared towards evaluating volatility and the probability of profit. Since 90% of the trades placed are derivatives, they spend most of their time designing tools specifically for option traders.
So, how exactly does TastyWorks do this? For starters, their analysis page displays charting on open positions. I will discuss this later, but it tells you how much you can gain or lose if you adjust your open position.
In addition, just last month, TastyWorks introduced ChartGrid. This fantastic desktop application allows traders to load up to 10 underlying on a single page.
More importantly, all charts are customizable, and you can trade directly from them, which makes you the best broker for options trading.
Consistent Look and Feel
There’s nothing worse than getting used to a broker’s specific charting platform only to face a different look on your mobile. Trading is hard enough as it is without struggling to find VWAP or level 2 data.
Luckily, the look and feel of their mobile platform is quite similar to their desktop version. So users can sigh in relief as their watch lists are the same on mobile, web, and download platforms.
Although a newcomer to options trading might be initially uncomfortable, you’ll come to appreciate TastyWorks’ features in time.
Analyze Your Positions
You can thank their analysis page for that. Let’s say you have a few different positions on Facebook, like an iron condor and a butterfly spread.
Within the page, you can analyze the risk profiles of combined positions and see how a possible adjusting position will change that trade outlook.
You can quickly modify your current position using the chart to enter/exit your trade rapidly. For this reason alone, TastyWorks is the best broker for options trading.
I can’t stress enough how remarkable this tool is. Any option trader will greatly appreciate the platform’s spectacular attention to detail.
Let's Talk Money
Pricing is one of TastyWorks’ strong points. When it comes to options, they completely outperform every other brokerage firm I know.
There is no comparison. First, TastyWorks does not have account minimums, and second, its initial commissions are practically non-existent.
And finally, they have no commissions on closing trades. In all my years of trading, I haven’t seen any other broker do this.
Why TastyWorks Is the Best Broker for Options Trading
- Every tool you need to analyze and trade options is built into their platform.
- Their platform is geared specifically towards options traders. This means you can analyze your risk profile if you have multiple positions on a specific underlying.
- You can analyze all the different risk profiles of a combined position.
- With endless hours of trading videos, shows, and up-to-the-minute trade ideas, you can’t beat their educational support.
- $0 account minimum.
- $0.00 stock trades, $1.00 to open options trades, $0.00 to close.
- In addition to their attractive commission fees, TastyWorks doesn’t charge for the use of their software or access to data. This is a bonus!
Cons of TastyWorks
- It can be overwhelming for newcomers at first. But isn’t every trading platform the same when you start?
- Poor tools for technical analysis.
- Outside of ETFs containing bonds, there’s no fixed-income trading for those who want to put some of their assets into a more conservative asset class.
- Access to US-only markets leads to more limited trading in equities and futures.
- News and data aren’t the best. I suggest accessing your data elsewhere.
- You’ll need to log in to The Quiet Foundation if you want any additional portfolio analysis beyond profit and loss.
- There is no demo account to practice.
- No direct-access routing hinders day traders.
If you can use another platform to analyze and access data and news, TastyWorks is the best broker for options trading.
Who TastyWorks Isn't For
Anyone who doesn’t trade options. If options trading isn’t your focus, I suggest you check out other brokers like Questrade or E*Trade. Even though TastyWorks fees are still competitive for futures and equities, you’ll find better value elsewhere.
Furthermore, the technical analysis and interactive chart functions are underdeveloped compared to other brokers. So if you trade stocks based on charts, this is not your platform.
Final Thoughts: Best Options Trading Platform and Brokers
Study like crazy and take advantage of the resources offered to you. Options courses help you learn different aspects of trading, such as put and call options, the implied volatility formula, and its meaning.
Options have many moving parts, so there is a lot more that goes into profit and loss. It’s imperative to learn stock training, which requires study, discipline, and practice.
A platform with a simulated account is a great choice. It allows you to practice without using real money. You can see how options chains work and determine how time decay or open interest affects your contracts. TD Ameritrade has a great simulated options trading platform.
Finding the best options trading platform depends on your preference as a trader. You can find out what you think is important as a trader, and then choose a broker based on that.
