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OptionsHouse Review: $3.95 Stock & Options Trades

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OptionsHouse Logo$3.95 a trade.

(Update 1/14/11: OptionsHouse recently increased their commission from $2.95 to $3.95)

That’s how much it’ll cost you to make a trade at OptionsHouse.

That’s pretty cheap. TradeKing is currently my go-to broker and they charge $4.95 a trade, 67% more than OptionsHouse. Zecco, which is free if you meet their stringent requirements, is the only one that’s cheaper and they can never seem to get their customer service issues resolved.

They’re another one of those brokers that started as a options trading brokerage and soon moved into regular stocks. TradeKing and OptionsXpress are two other popular brokers that made that move too.

Background

OptionsHouse is member of SIPC, which means your investments are protected by SIPC insurance up to $500,000 and $100,000 of it can be in cash, and they have excess SIPC Insurance of $200,000,000 in aggregate across all customer accounts. They were founded by PEAK6 Investments, L.P., an options-trading firm and they claim to be one of the largest in terms of volume.

Prices

I’ve already mentioned the $2.95 stock trades, which is one of the cheapest around, but what about options trades? OptionsHouse’s $9.95 flat-rate is competitive with many other discount brokers and beats all the full service ones. OptionsXpress’ charges $12.95 and TradeKing charges $4.95 plus $0.65 per contract. What’s interesting about OptionsHouse is that their price is a flat-rate, whereas most others charge a base fee plus a smaller fee for each contract.

Tools

I don’t have an account there so I can’t do any further digging but their tools all appear to be very options-centric:
OptionsHouse Tools

You can watch a video tour of the site here. One quick warning, it auto-plays so watch the volume on your computer. Also, a look at the tools starts about 35 seconds in of the three and a half minute video.

Awards

In terms of awards, which I don’t think is ever a good way to judge a bank, OptionsHouse recently was awarded four and a half stars by Barrons and considered the best for options traders. They beat out thinkorswim, optionsXpress, E*Trade, and Charles Schwab. From the article:

As its name suggests, OptionsHouse has a lot of great tools for the options trader. Backed by market maker PEAK6, this broker lets its retail customers use quite a few professional-level tools. Building a spread is very intuitive on this system, as is rolling a call or put from one strike to another. The site’s motto is ‘Fast matters,’ and that goes for everything from finding possible trades to populating an order ticket to executing the trade itself.

It’s spawned a discussion on Fatwallet with a handful of people stating they’ve been happy with the service. People have reported good experiences with their customer service (one person even calling out Zecco) and calling it a good alternative to Scottrade. As more people use the service, that thread will likely grow with more anecdotes and opinions.

Have you used OptionsHouse? I’ve been looking to get more into options trading so I’d love to hear your feedback if you’ve used OptionsHouse.

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34 Responses to “OptionsHouse Review: $3.95 Stock & Options Trades”

  1. susan says:

    I have had exceptionally positive experiences with OH and have recommended it highly every chance I get. I belong to several investor/trader groups and have not heard anything but positive comments there other than the one complaint that I have. You cannot modify orders after hours, even as pending orders and have to wait to open to enter them. The customer service is among the best I have enjoyed in any industry and believe me, when I first began trading I called them frequently! Be aware that any new accounts (as of October 1) will see a slight increase in fees but current traders will not, even if they open additional accounts later. They also have updated some of their resources so you many want to recheck those if you had ay previious complaints there.
    Although the after hours modification issue is important to me, it will not cause me to make a change. OH has too much going for it for me to leave.
    Happy Trading

  2. Shawn says:

    Started trading in Oct 2013.
    After four days I had to move the account to a different broker. The platform required me to make 3-6 attempts to place an order which is the basic function of a broker. Sad when they can’t handle that one simple thing which is what provides their income. That should be all you need to know. AVOID!


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