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Online Brokerages I Use: OptionsHouse Review

Options House Review

OptionsHouse is a great brokerage to consider if you’re looking for a low-cost option for your investing needs. I have been investing with OptionsHouse for the past three years now, so I write this OptionsHouse review as someone who has had quite a bit of experience in using their platform. I’m not a terribly active trader, though OptionsHouse is a good brokerage to look at if you’re interested in investing in options or are a somewhat active trader.

Open an account with OptionsHouse today and get 100 commission free trades!

I’ve reviewed other brokerages in the past, like with my Scottrade review and am doing a review of OptionsHouse as it’s the other main platform I use alongside Scottrade to manage my investment needs.

As I have said before, I love talking about investing in the stock market, especially with beginners. As I worked in the brokerage industry for a number of years I have seen firsthand 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.

With the number of online brokerages available, it can be difficult for many investors to know where they should start, especially when so many seem alike. With that in mind, I have had a great experience with OptionsHouse as I opened a Rollover IRA with them about three years ago and have really liked what I have seen thus 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.

OptionsHouse is a newer player in the brokerage space, being around for the last eight years. They’re run by and a part of Peak6 Investments which is based out of Chicago and has been rated by Barron’s as a 4 (out of a possible 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.

OptionsHouse Features

 

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 required 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 good tool to have. The paperwork itself takes about five minutes and once done you’re good to go.

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. 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. In terms of options pricing, most of the larger online brokerages will charge what they normally charge for a stock trade plus some other fee. That is not the case at OptionsHouse.

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 and the commission structure can’t be beat. In addition to the low fees, their margin rates are very hard to beat. With that in mind, this allows you to keep more of your money working for you in the market as opposed to their pockets.

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 unfortunately 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. OptionsHouse also offers an instant chat feature which is very easy to use.

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 per industry regulation.

Efficient Trading Tools: While OptionsHouse doesn’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 and competitive, 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. With their focus being on the more active trader, I can understand the reasoning behind the limited offerings though.

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 unbeatable 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 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. This allows me to bring enhanced focus on my investing without spreading myself too thin.

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 quite a few promotions from free trades to a free Kindle Fire HDX. Make sure to check out my Optionshouse promo code post to see what their current promotions are.


Get up to 100 commission-free trades in your first 30 days at OptionsHouse

 

Where do you handle most of your investing needs? What are you paying per stock trade?

 

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Summary
Reviewer
John Schmoll
Review Date
Reviewed Item
OptionsHouse
Author Rating
5
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I'm the founder of Frugal Rules, a Dad, husband and veteran of the financial services industry. I'm passionate about helping people learn from my mistakes so that they can enjoy the freedom that comes from living frugally

31 Comments

  • Thanks for the review John. I haven’t used OptionsHouse…only Scottrade. I’ll have to check it out.
    Greg@ClubThrifty recently posted…Save Money, Save the PlanetMy Profile

  • I also haven’t used OptionsHouse, but it sounds like a great platform (especially for trading options). Learning more about investing is a goal of mine this year, so I definitely would find some benefit from the virtual trading account.
    DC @ Young Adult Money recently posted…5 Frugal Summer ActivitiesMy Profile

    • John says:

      It really is a good alternative if you’re looking to get into options trading. The virtual trading account is worth it in my opinion.

  • AverageJoe says:

    That’s an awesome rate on options trades. Thanks for another thorough review. I’m surprised I’ve never even run across OptionHouse before.
    AverageJoe recently posted…3 Easy Steps to Increasing Investment ReturnsMy Profile

    • John says:

      Not a problem Joe! I agree, the options rates are a steal if you ask me. I have a small Roth I am looking to move and just may move it there to take advantage of the rates. They’re newer, so it doesn’t surprise me all that much. That said, I think they’re growing quite well.

  • Thanks for the review. I hadn’t heard of Optionshouse, but sounds like a fair commission structure if you are looking for those type of investments.
    Kim@Eyesonthedollar recently posted…How Much Does a Trip To The Emergency Room Cost?My Profile

  • Jake Erickson says:

    I’m with Kim, I hadn’t heard of Optionshouse before, but it sounds like a decent option. When I begin investing in the next 6 months I’ll probably stick to mostly mutual funds. Optionshouse doesn’t sound exceptionally great at this, so I may have to look around a bit more. Thanks for the review!
    Jake Erickson recently posted…How much do pets really cost?My Profile

    • John says:

      It is a fairly good option, especially if you’re looking towards trading stocks, etfs or options. If you’re looking mainly towards mutual funds, then someone like Scottrade would be a great choice.

  • Thanks for the quality review John. I have been looking and seeing this company around getting some love, but haven’t seen a good review like yours. I appreciate the information.
    Grayson @ Debt RoundUp recently posted…SmarterBucks® Review – A Rewards Program Geared Toward Student LoansMy Profile

  • Boris says:

    I use fidelity. Thanks for the review. Does optionshouse provide good tax statements at the end of the year?
    Boris recently posted…Avoiding The Worst Couponing MistakesMy Profile

    • John says:

      Fidelity is definitely a good option to use. I only have an IRA with them currently , so do not have any experience on the tax statements. Their monthly statements are just fine and have had no issues with them and have heard no complaints about their tax forms.

  • Brian says:

    Do they allow you to DRIP shares of stocks? I know Scotrade has been slow on this front and it drives people a little crazy.

  • Is there a time-limit on the free trades? That is how eTrade got me. It turned out those free trades were only in the first 30 days of the account, so in reality I had ONE free trade. Of course, free isn’t actually free, either. I had to pay the trade fee which they refunded at the end of the 30 day period. If I had taken advantage of all of the free trades, I would have had to pay several hundred dollars extra and wait for the money to be refunded.
    Edward Antrobus recently posted…How to Fix Incorrect Charges on Your Credit or Debit CardMy Profile

    • John says:

      Ugh…I hate it when brokerages do that. Why charge you for something and then “credit” it back to you at the end of the term?

      For most of their promotions it’s a 60 day window you have, though I believe a few of them go as high as 90 days. The free trade is free, so no funny accounting. It’ll just show on your trade confirm that it was free.

  • I have an account with Optionshouse, although I don’t currently use it. The flat rates are very good but I’m not currently picking stocks so Vanguard gets all my attention…

    Great review John!
    Jacob@CashCowCouple recently posted…How to Make a Cute To-Do BoardMy Profile

    • John says:

      Thanks Jacob! I agree that the rates are very good. What are you investing in at Vanguard? If it’s ETFs you can find any of those and for cheaper at OH.

      • Brian says:

        Trading Vanguard ETFs is commision free with a Vanguard brokerage account… so I don’t see how that would be cheaper at OH….

        • John says:

          That’s great Brian! However, correct me if I am wrong, but I believe that it only applies to Vanguard ETFs. Which, if “you” are fine with only investing in those then that is fine. I was speaking in generalities as Jacob was not specific in what exactly he is investing in at Vanguard.

          • Brian says:

            That is true. If you are investing in other ETFs the fees are pretty awful at vanguard (I want to say is is pushing $20 a trade like an old school broker). There are also a few possible fees for account minimums if you don’t sign up for their e-delivery package too so I would agree that if you don’t want to only invest in vanguard ETFs then OH looks like a clear winner!

  • I have actually never traded options. I always considered myself too naive or too risk averse to even tackle the topic of options. I have had for a number of years accounts at TradeKing and TD Ameritrade. I like both because they are easy and I don’t get bothered with countless emails or physical mail all the time. Some business, as you know will plug your inbox and mailbox.
    Scott @ Youthful Investor recently posted…Why I will NEVER Invest in Demand Media – Digital SharecroppingMy Profile

    • John says:

      Options are definitely something you want to steer clear of if you’re more risk averse. I am with OH & Scottrade and thankfully they do not fill up my inbox.

  • All sounds great, besides the lack of mutuals. I would guess that they will build up this option in the future, though.

    • John says:

      I do think it’ll hold some back. However, I do not see them going in that direction as that’s not really their client base…not to mention the fact that ETFs are dealing a very decent blow to many mutual funds.

  • I love the idea of trading options. I was just never that great at it during my early years of investing and it created too much stress for me. So I pretty much gave it up for the traditional long term investing approach.
    Brian @ Luke1428 recently posted…Hey Parents…It’s OK to Create Cheap MemoriesMy Profile

    • John says:

      They definitely can be stressful, especially if they do not line up with your risk tolerance. I think for many they should stick with the basics unless they educate themselves appropriately.

  • Jim says:

    Thanks John, I haven’t ever heard of OptionsHouse, will check it out. I really love the ability to virtual trade, as I want to learn about options but dont want to start with my own money. This would be great. Looking forward to your review on T.D Ameritrade before I make my decision.
    Jim recently posted…A Funny Thing Happened On The Way To The….MailboxMy Profile

    • John says:

      Not a problem Jim. The virtual trading aspect is really nice, not to mention the commission pricing.

      I’ll likely not be running a review on TDA, though if you have any questions on them just shoot me an email and I can answer any questions you may have.

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