OptionsHouse is a solid brokerage to consider if you’re looking for a low-cost option to the more traditional online brokerage. OptionsHouse is also a great brokerage to look at if you’re interested in investing in options or are an active trader. Since I’ve been a client of theirs for the past two years, I thought an OptionsHouse review would be in order to share about my experience with them.
I’ve reviewed other brokerages in the past, like with my Scottrade review and today I bring you my OptionsHouse review which is the other main platform I use alongside Scottrade to manage the investing needs of my family.
As I have said before, I love talking about investing in the stock market, especially with beginners. As I have worked in the market space for a number of years I have seen what many regular investors bring to the table and often times it boils down to education and needing assistance in terms of how to best determine what direction they should go. I am passionate about sharing my knowledge with others so they can make informed decisions about investing in stocks and more importantly, wisely investing for their future. That said, I opened a Rollover IRA with OptionsHouse about two years ago and have had a great experience with them so far.
Looking for another brokerage option? Check out my OptionsXpress review for another solid low cost brokerage.
As I’ve said in the past, there are dozens of platforms available and many will claim to be among the best online brokerages, though it’s not always the case. Ultimately you need to find what works best for you and what will meet your needs as an investor.
That said, OptionsHouse is a newer player in the brokerage space, being around for the last seven years. They’re actually run by and a part of Peak6 Investments which is based out of Chicago and has been rated by Barron’s as a 4-star brokerage each of the past four years. Over the past few years OptionsHouse has gained steam that has allowed them to stand out as a major player in the active trader/options investing market.
Streaming Quotes: Many brokerages offer streaming quotes, but are not always free. This is not the case with OptionsHouse. Once you open your account and fill out the requisite paperwork you have access to free real time quotes. If you’re someone that likes to keep a pulse on a specific stock, or the stock market in general this is a great tool to have.
The Trading Platform: The platform is straightforward and robust, while also being fairly simple to use. If you’re looking to place stock trades it is a flat $4.75. Yes, you read that right…a flat $4.75. If you’re looking to trade options, which is their bread and butter then the commission is $5 for up to $5 contracts with $1 per contract thereafter or a flat $8.50 per contract with an additional $.15 per contract. Speaking from knowledge, these are VERY competitive rates as most brokerages will charge at least $7 per stock trade, if not closer to the $8 or $9 range.
Free Virtual Trading: I LOVE this feature and do not use it nearly enough. Do you have a stock strategy you want to try but aren’t quite ready to invest your own money? OptionsHouse gives you, with each account you open, a $5,000 virtual account, which you can use to test-run trading strategies.
New Research Function: This is a new feature recently added to the platform which I absolutely love. OptionsHouse has created a centralized spot that lists analysts reports, technical events and competitor news (just to name a few) on specific companies. This new feature, along with their excellent charting functionality, allows you to make a more informed decision when comparing companies or funds to invest in.
Advantages of OptionsHouse
Fees Fees Fees: I am a firm believer that you should not choose an online brokerage based off of commission prices alone, but it’s hard to look at OptionsHouse and not like their fee structure. They have no hidden fees to speak of and the commissions are out of this world. In addition to the low fees, their margin rates are very hard to beat.
Customer Service: Every time I have contacted their customer service center I get someone that actually knows what they’re talking about. Let me shine some light on call centers for some online brokerages – you will not always find people who know what they’re talking about. It’s sad, but true. If you’re an active trader, or a buy and hold investor, you’ll come to appreciate this as you get the answers you need as well as the confidence that they know what they’re talking about. They also offer a handy instant chat feature which I find invaluable.
Low Initial Minimums: If you’re looking to open an account with OptionsHouse, there is a relatively low barrier to entry as there is a $1,000 account opening minimum. If you’re looking to trade on margin, it’s a minimum of $2,000, as it would be with any other brokerage.
Efficient Trading Tools: While OptionsHouse can’t boast the trading tools that you’ll find at places like Scottrade, they’re still very efficient and can hold their own. Their tools started out as more along the active trader bent, but with the addition of the new research functionalities mentioned prior they now offer more of the traditional tools a less active trader would be looking for.
Disadvantages of OptionsHouse
Light on the Mutual Funds: If you’re looking to trade mutual funds with OptionsHouse, you’ll have few options available. While the $9.95 commission is VERY reasonable, the selection is limited. They offer roughly 1,000 no-load mutual funds. While it is good that they offer no-load funds, I would still like to see a more expansive offering from them.
Limited After Hours Trading: Most online brokerages allow you to trade in the after hours (the stock market is open for trading after the normal market is closed, but on a much more limited basis) until 8:00 P.M. EST. However, with OptionsHouse, they only allow trading until 5:00 P.M.
What’s My Take on OptionsHouse?
If you’re looking to invest in the stock market, there are many options to choose from. Each of the players have things that set them apart and the case with OptionsHouse is that they offer great rates and a solid platform to trade in. If lower rates are your thing and you’re looking to invest primarily in stocks, etfs or options then they are definitely worth a look. I prefer to have several brokerage accounts as I can trade in one if the other platform is down as well as having different strategies for certain parts of my portfolio.
The other thing it allows me to do is trade a little more actively in one and do more options trading in one and do my more long term buy and hold type strategy in the other. Regardless of your investing bent, OptionsHouse is a great choice and you can open your account online and be ready to go in as little as 15 minutes. OptionsHouse sweetens the deal by often running promotions for free trades or a cash bonus to clients who open new accounts.
Where do you handle most of your investing needs? What are you paying per stock trade?