It has been awhile since I’ve done an online brokerage review – well no longer! Today I am going to go over my OptionsXpress review. To be completely honest, I’ve never had an account with OptionsXpress, but I have dealt with them extensively from my days in the online brokerage industry, am familiar with their platform, and have spoken with their customer service representatives quite a bit. That said, I’ve always been impressed in my dealings with OptionsXpress and believe they’re worthy for a review. If you would like to check out my other brokerage reviews, you can do so below:
There are many online brokerages to choose from, each with their own little bit of differentiation which can make it difficult at times to choose what might be the best online brokerage for you. With that in mind, if you’re just looking to invest in stocks or in index funds and want to handle it all yourself then it largely comes down to pricing and offerings. In regards to OptionsXpress, they have been a major player in the brokerage industry since their inception in 2000 and even more so since they were acquired by parent company Charles Schwab in 2011. Enough background, let’s move on to the review of OptionsXpress.
Trading Platform: The trading platform at OptionsXpress is better than most. Intuitive and user-friendly, the platform seems optimized for placing trades. At $8.95 per stock trade and $14.95 per option trade they are on the higher end of average, but their pricing is flat and has no extra charge for broker assisted trades, which is a nice plus.
Free Streaming Quotes: Like the other brokerages I’ve reviewed, OptionsXpress offers free streaming quotes. Just fill out some paperwork online after opening the account and you’re good to go. This is a huge bonus to have, especially if you watch the market at all and do any kind of trading.
Virtual Trading: Like OptionsHouse, OptionsXpress has a free virtual trading platform where you get $25,000 play money to test out strategies or ideas. If you’re just starting out investing in the stock market, this can be a great way to get your feet wet before throwing real money in the market.
Futures/Forex Trading: Like Etrade, OptionsXpress offers futures and forex trading. While this type of trading is not for everyone, it is a nice feature to have if you do enjoy that style of trading and they have very competitive rates with $3.50 for futures and no commission on forex trades.
Advantages of OptionsXpress
Schwab Connection: One of my favorite things about OptionsXpress is their connection with Schwab. This means you get access to Schwab’s free list of over 100 commission-free ETFs as well as a host of any other tools Schwab offers.
Flat Pricing: While Etrade does not offer flat pricing, OptionsXpress does. I know their pricing is a little on the high end of average, but it’s a flat rate as well as having no additional charge for broker assisted trades. That is a huge bonus.
Powerful Trading Tools: Trading tools is one area where a brokerage can set themselves apart and OptionsXpress does not disappoint. OptionsXpress has a wide variety of tools from novice level to more advanced. They also offer numerous free online and live training seminars which can be a huge benefit if you’re trying to formulate an investing strategy.
No Minimum to Open: Many brokerages will have minimums to open an account and can vary widely. That is not an issue with OptionsXpress as you can open an account with any amount and get started.
Stellar Customer Service: I will pay more for good customer service, and you’ll find that with OptionsXpress. Every time I have spoken with one of their representatives I have always been impressed and they offer real-time chat, which is a nice added benefit.
Disadvantages of OptionsXpress
Higher Commissions: I typically like to pay closer to the $7 range on my stock trades and OptionsXpress comes in at $8.95 per stock trade. While that is on the higher end of average, the nice thing with OptionsXpress is that their pricing is flat and with absolutely no hidden fees which mitigates the higher pricing to a certain extent.
Lower End of Mutual Funds: If you like to invest in mutual funds then OptionsXpress is a little on the light end coming in at the middle of the road with offering 5,300 mutual funds. That should be enough, but I would still like to see a few more. That said, their pricing on mutual funds is quite nice coming in at $9.95 plus any applicable load charges.
Not Available 24 Hours: This may not be an issue for many, but they’re not open 24 hours a day – unless you’re trading futures. They’re open until 10:00 p.m. EST Monday through Friday and until 2:00 p.m. EST on Saturday. This isn’t really a big detractor, but is important to note.
My Take on OptionsXpress
I think for either the active investor or the buy-and-hold investor, you really can’t go wrong with OptionsXpress. I know their pricing is a bit on the higher end of average, but their flat pricing and connection with Charles Schwab would negate that point for me. They have a number of great investing tools and resources that are free to use and have good access to various other niceties. This is also not to mention the fact that they’ve been voted one of the best online brokerages by companies like Barron’s and Smart Money. If you’re looking for a solid online brokerage with reliable resources, then OptionsXpress may be for you. You can open an account online and generally have it active within about 15 minutes. As an added bonus, OptionsXpress is usually offering some sort of account promotion when you open an account with them varying from free trades to cash and gift cards.
Where do you do your investing? What do you look for in an online brokerage?