The Options Insider - Your Inside Source for Options Information

I can't speak about the others, but Think or Swim is really quite good for the retail trader. Good tools, good education, great platform, and negotiable rates. The founders are legit as well. Tom Sosnoff still answers client email and will occasionally speak during their weekly chat seminar.

I don't know.....

OptionsXpress is an obvious choice. They were one of the first to really dive into this business.

However, a lot of people seem to like Think or Swim on this board. So I'm going to withhold my vote until I learn more about Think or Swim.

I'm going to go out on a limb and say Trade King. I have limited experience with them myself, but I have several colleagues who use them for their retail accounts. This firm has quietly built up an interesting presence in the options market. Good tools. Decent position management stuff and they are building a strong educational arm. Overall, I've been impressed by what I've seen. If I open a retail account, I'll probably go with them.

Like I said in the other thread, I recently saw a presentation by the founder of Think or Swim. It definitely improved my opinion of the tools available to the retail investor. I actually might open an account just to see what all the fuss is about.

Sosnoff is something else, but I'm not a fan of his platform. I think retail options traders are better off sticking with OptionsXpress. That firm has really pushed the envelope in terms of what retail options traders should expect from their broker.

If it wasn't for OX, retail options customers would still be phoning their orders into their broker. It's because of them that the rest of these newcomers have a market to steal. I think the answer to this question is obvious.

Well if you're a pure price shopper, and many retail traders are, then Options House is clearly your choice. They are aggressively marking down their commissions to attract new customers, so you can really get some good deals with them right now.

I also have to give a tip of the hat to Trade King. Most people have never heard of them, probably because they don't have the word "options" in their name. However, they are coming on strong in the options world. As Jared said, they have good education and their pricing structure is competitive. They definitely merit some investigation if you are considering jumping into the options game.

I wouldn't dismiss being the first, Jared. That gets you a lot of cache in the marketplace. It also allows you to build the market as you see fit. It also forces everyone else to follow in your wake. Judging by the middling success of later entrants like Options House, that is a substantial advantage.

I think it breaks down like this:

OptionsXpress if you want the best tools

Options House if you want cheap commissions

Think or Swim if you want the best education.

Etrade, Trade King, Scott Trade and the rest of the pack if you want a broker that is mediocre in all three...

I don't know if I would call Trade King mediocre. They have very good commission rates and customer service. But I agree that their tools are sub-par.

I don't know much about this stuff, but isn't Interactive Brokers aimed at professional customers? I didn't think they were a retail brokerage firm.

That's true. IB doesn't really cater to the retail crowd. It's more for the high end of the options crowd. The people that understand the value of quality executions over simply low commission rates.

The TOS "PaperMoney" acct fills between the bid/ask and is not always reliable for realistic fills.

I remember using an X-trader simulator for futures. I was King of the World. Then I started trading for real, and I turned into the world's doormat.

I don't have the answer to your main question, ToS vs IB in the quality of execution.

What I will say, is that I sometimes get much better fill pricing (with ToS). That is encouraging.

fsprea,
This would be an interesting test. Of course you have to be willing to do this same test around 20 times on various different order types and underlyings. Could be expensive to you, but interesting and educational for the rest of us. Perhaps theoptioninsider could fund such an experiment!

In fact, forget about saving a penny here or there, it would be revolutionary if someone actually did such a test on all the major option brokers and then reported on this. It wouldn't cost too much for any well funded news organization, and if reported could change the focus of brokers to quality of executions rather than all the useless bells and whistles they advertise. Of course, all of 3 retail traders would care about such results!
st

Dear Athos,
thanks for the advice. Although I cannot completely get the point: why should a spread be more dangerous than a naked call or put? With the proper strategy you're actually hedging much better than a single arm. Of course I'm not going to short a straddle, but for instance a plain long calendar spread is better than a long put, in terms of risk. At least this is what I simulated in the last six months, with constant small but always increasing "simulated" profits. And now I want to see what happens in the real world! About IB, I'm not saying they are making the "wrong" thing, but just that maybe there is someone else making it better... It could be, isn't it? For sure you can probably agree that, if during the trading day, a position is hitting the limit several times (calculating the difference between the long snd the short arm) and you do not get filled, this means that the system is not very efficient in matching quotations for the two arms... At last, with the rebate that ToS offered me without as soon as I asked for it, I decided to go for them. At least the trading environment is much more user-friendly!

Exactly. You don't want to get hung or miss a leg when trading combos. They require a certain amount of finesse and the experienced hand of a good broker to execute properly.

I can't tell you how many times I've had combo trades executed incorrectly. Even if both sides of the trade are executed, they are often executed at prices that erase most of the edge of the trade. In fact, I rarely even bother with combos anymore simply because I can't find a broker that executes them well.

This thread has opened my eyes quite a bit. Like many pros on this board, I used to lump all retail brokerages into the same category. They all offered free, if somewhat gimped, tools and relatively low commission rates and that was about it.

However, judging from the impassioned and informed responses on this thread, there is far more to the retail market than meets the eye.

Options Insider Radio listeners will have a chance to learn more about OptionsXpress very soon. David Fisher, OX's CEO, will be our guest on an upcoming episode.

I'd like to offer forum users a chance to ask their own questions to David. Surf on over to the "Questions For Options Insider Radio" section of this forum. Once you're there, post your questions/comments for David in the designated thread. If the questions are interesting or insightful, they will be used in the final program.

Mark

Great show. Finally got around to catching it.

Back to the point of the thread, have we determined an overall winner of this smackdown?

WHO IS THE BEST RETAIL BROKER OF THEM ALL?

This thread has been around forever but I have yet to weigh in on it. Strange that I haven't gotten around on it until now.

I'd have to say that my experience at Options House has been the best. Granted, I trade larger size than the average retail customer, so I'm probably biased by the flat rate. I also have most of my own tools, so i don't rely on the Options House platform as much.

But I think they are a fine broker. Particularly if you want to trade some size orders.

Hello everybody! I have been trading options for about 25 years now and I remember the days before online brokers existed! Talk about poor execution and high commissions!

Anyway, I trade with both Tradeking and OptionsXpress. I find that for beginers, Tradeking is probably the most attractive because of their straight forward, simple platform and unintimidating "look and feel".

OptionsXpress has given me very good execution and they have been more inclined to negotiate their commissions. Important for someone who puts on a lot of iron condors and butterflies like myself.

My vote goes to OptionXpress.

Hi Thomas,

I heard that the executions at Options House are pretty bad unless you trade size.. Again this is something I heard from someone who was trading with them and decided to go to OptionXpress. I have been with them (optionsXpress) for a couple of years now and I am pretty happy with them. I guess you get used to a platform and it takes a lot to get you to move! The account at Tradeking is an account I opened a while back at the urging of a friend who works there...I don't trade very much with them at all besides the very infrequent long shot individual call or put position, but like I said, I like their platform especially for beginners.

Hello CB,

Yes that is correct

Just an observation on the "look and feel" of the Tradeking site.I think they have done a great job with their user interface.

Like I mentioned I prefer OptionsXpress for my bread and butter trading(better execution, relative cost, tools, etc, etc) but I know a lot of traders who swear by TK. I think that for the most part, once one becomes familiar with a particular trading platform it is very difficult to make a switch.

I'm a newbie trading options. I am only doing the buy to open and sell to close routine in two different cash accounts. I got my inspiration from buying a Darlene Nelson course. I virtual traded with OX and OH. When it came time to fund I went with OH.

In my office there are three of us trading options. Two are with OXpress and I am at Optionshouse. During all the recent volatility the OX guys can't get logged in (not enough server at OX) while at OH I can login and make my trades. Two of the three of us are newbies (I'm one of them). I hate it when I make a bad trade but at least my commissions don't give me a big kick when I'm down adding insult to injury!

As for execution, OH has been great for me. Once I get within a penny of my price (for either buying or selling) I know it will be gone quickly and it is.

I virtual traded several months before funding. I liked the "feel" of Oxpress better than OH at first but I have come to really like the OH platform. This along with not being able to login during heavy trading moments is why there will be three of us trading at OH very soon. The other two guys haven't been able to login enough that they've had it with Xpress.

Things Xpress has that I liked that OH doesn't have:
charts for each individual option
OCO and OTO orders (OH says they will get these soon)
"ticker" that can be detached from the webpage for each option with option price plus index values (this is great at work as a quick glance is all that's needed to see where the position is).

Things I like about OH over Xpress:
$10 per trade (really helps in a losing trade but I keep more $ on a good trade)
order page shows all data on one page so I don't need to fumble between pages
Modifying an existing order to change the price on an open order
ability to replicate a previous order as quick as you can click your mouse

The modifying order thing has been a detriment for my friends at work and I think that might part of why OH says "fast matters".

I believe Think or Swim also offers that functionality, although don't quote me on that.

Ha! You are missing out on the fun and apirit of this thread, SP. While it's true, we want to find the best broker in terms of price, execution, etc..


...but we also want the horse race!!! We want to get in and fight for our favorite broker and slam the ones we hate!! That's probably the best part. It's also the reason why this thread has been going strong for well over a year. People just love to dive in and mix it up when it comes to brokers.